[Calc Review] Help me analyze this deal in West Chester PA

[BW Miller]

Hi - completely new to the game of rental real estate. Although I'm not targeting this particular area or home type, I'm looking into it because I have an angle on the homeowner. However, I can't make these numbers work even if I lower purchase price by 20-25%.

Is it possible that property taxes can be so high in a particular area it's completely infeasible to turn a profit off a rental home? I'm being conservative with nearly all my numbers and then removing costs for property management (I'll take that on). I still can't get anything close to 12% ROI. I think the rental rate I've estimated is fair for the area. Thx!

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*This link comes directly from our calculators, based on information input by the member who posted.

[Rich O'Neill]

Hi @BW Miller Seems to me like you either need to get way more in rent or look at less expensive properties. Many folks on here subscribe to the 1% rule where your monthly rent should be at least 1% of your all-in price. In this case you are only at about .75%. I would hope at this price point that your repair budget and a few other items are overestimated, which should make this cash flow number better. The real play here is mortgage pay down and hopefully some appreciation. I am not the best to talk to in this area though because I use the 2% rule on much lower priced properties. 

Good luck! Let me know if I can be helpful in any way.