You can budget around 4% of the sale price to cover these.This is a conservative formula.

I tried to go conservative and buffer some numbers with cushion.Property Info: Single family house, 2Br/1Ba, 860 SQF.

I've run it through the BP rental calculator with conservative, medium and liberal scenarios and it looks like the property would cashflow between $450-$1,000 / mo. 

I say “Yep”.When the bank came back with the increase in EMD from $500 to $2500, I asked my agent if that was because they wanted to increase the likelihood that I would not walk.She said that she believed that was the case.So, I believe at this point, ensuring I close is more important than the sales price.Plus I already stated that $17,500 was best and final.So, I countered back at $17,500 with $2500 EMD.It was accepted.My lender couldn’t believe it.After closing, the bank and I discussed financing options.Since it ended up being all my cash for the purchase, we decided on a construction to permanent loan.We got an appraisal value for its as-is condition and it’s ARV.When analyzing the property, I tried to be conservative and used a $120,000 ARV.As-is condition came back at $60,000, and ARV came back at $145,000.Comps were had to come by, as this is a small, rural town and there hadn’t been many homes sold recently.The bank would ultimately lend me up to 75% of the ARV, or $101,000 in 4 draws.The loan would be interest only during the renovation, and convert to a mortgage when completed.The loan is 10 year fixed at 6.25% with a 25 year amortization.Projected costs: Electrical work--$5,300Renovations--$64,000Zoning Hearing for approval for conversion--$1,500Insurance, permits, property taxes, and other holding costs--$2000Total Budget--$73,800Renovation took just under 3 months, with virtually no surprises.The electrician came in at budget, and the renovations had $4,000 in overages.With the purchase price, loan costs, and renovations, I am right at $101,000.I also believe that if I chose to get a new appraisal, it would come in much higher, as since the first one, a few houses in the area have sold and would support a higher value.So here’s a quick run-down on the numbers:All-in price:$101,000Value:$145,000Income:$850/month x 2=$1700Monthly Expenses: Maintenance 10%:$170Capex 10%:$170Vacancy 5%:85Electric:$20Trash:$55Insurance:$100Property Taxes:$185.33Mortgage:$666.27Total:$1451.60Monthly Cashflow--$248.40Money in the deal—ZERO DOLLARSYes, I know that I did not account for property management in my numbers.The reason is that there is industry moving into the area, and higher paying jobs as well.I believe that rents will increase and support property management down the road, if I choose.If that doesn’t happen, well then I’m stuck managing forever or selling it at some point, but it is a risk I am willing to take at this point.Is this deal a home run?

Bigger pockets is certainly a good resource to get started with. between podcasts and forums, plenty of information to digest but remember the best way to learn is to  conservatively buy the first property. 

If it's a single family house, I would think you could get them to put the water in your name, but I'm not sure.I would probably estimate $100 for insurance but that might be conservative for a SFH.Good luck!

Estimate time to close and repair is 2 months, conservatively.  

10% is a conservative figure.  

Also remember that generally speaking lenders are much more conservative on hotels than they are on apartments/industrial/office/retail.

I'm somewhat conservative from a risk standpoint (especially since I've never invested in real estate to this point), which is why the goal is to eventually own all the rental properties outright.