Rental Analysis

[Mike D.]

I've been analyzing some townhome/condos in the Denver metro area for the last few weeks.  I wanted to bounce some numbers off folks to see if I'm going about the analysis correctly.  The reason I'm questioning my approach is I'm not seeing anything that looks like it will cash flow which may be just part of the market we're in but I thought it would be good to double check.

My sources for information include Redfin, Trulia and RentOmeter.  Based on the numbers I've ran, I don't think any of the properties warrant more detailed analysis.  One example is as follows.  All numbers are per month.

2 bed, 1 1/2 bath 1,100 sqft
Purchase Price - $143,000

Rent - $1,479
Principle & Interest - $768
HOA - $226
Taxes - $54
Insurance - $55
Vacancy (10%) - $148
Repairs (10%) - $148
CapX (10%) - $148
Property Management (10%) - $148
Total Monthly Expenses - $1,694
Cash Flow - Negative ($215)

As stated above, this doesn't look like a deal because of the negative cash flow.  In the properties I've looked at, virtually, I have negative cash flow ranging from ($141 - $494) using 10% for vacancy, repairs, capx and pm.

I appreciate any feedback you might have and thank you in advance for your time.