4/1 SFH in western maryland

[Michael Marcoux]

Hi BP,

New investor here seeking advice from the more experienced. I finished my first flip last year...and just sold it a week ago and broke even, so I'm really hesitant to make another leap of faith. I want to be sure of my numbers this time around.

Short of it is, I'm looking at a 4/1.5 SFH in an area that would get me a solid $800 a month. The property sat on the market for over 100 days at 45k and recently went up for auction. No activity so far, so I'm guessing I could get it for 25k. Considering the property is in immaculate shape and only needs some drywall touch up and paint, I can't help but think this property is a steal.

So before I get to expenses, I have to wonder: is there something wrong with this property? Are there hidden issues I may not have seen? The only issues I can come up with are that it's in a mediocre school district, has an ugly exterior, has an oil heater, and was built in 1900. No lead paint or asbestos anywhere though. 

As far as expenses go, this is what I'm thinking, please correct me if Im wrong:

taxes: 67

insurance: 67

property management: 72 (9%)

utilities (water and trash): 85

vacancies: 96 (12%)

capex/repairs: 90 (@.67/sq ft - I've seen this figure elsewhere on BP, can anyone comment?)

TOTAL EXPENSES: 470

TOTAL PROFIT BEFORE MORTGAGE: 800-470 = 330 month*12 = 3960/year.

If I paid 25k upfront I would have a return of around 15.8%. All this sounds too good for a SFH. What else should I be asking? Do my figures look too generous?