It's an estimated cash on cash return given current rental rates subtract expenses assuming 7% interest rate, 10% management fee, 5% repairs, 5% capex and other expenses like mortgage, insurance, tax. it's a estimate to tell you what properties to analyze vs ignoreyou can see the are pockets of negative returns as well as pockets of positive return. this is to supplement the data @Devin Conley provided

The maximum fixed-rate period seems to be seven years, and there is generally a balloon payment at 10 or 15 years.

I financed this deal on a 30yr conventional loan and I put 11,000 down with a 6.625% interest rate.

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean?

Yes, that means he will have to give up his 3.5% rate (or whatever it is assuming lower then today rates) but it is what it is. 

Looking at this past week's CMI, it's interesting to see the buyer/seller positioning in the SE-ish area compared to the NW-ish area with rates high 6's in JanuaryStill bullish on W/NW future demand due to TSMC factory and other companies (dashboard snapshot below) but time will tell.

They give the same $12k in closing costs to new buyer, $24k in realtor commissions, tack on say $4k in late fees, foreclosure costs, etc etc etc  so they “net” $360k.

When looking at properties in other cities, I usually start by researching market trends like price-to-rent ratios, crime rates, and growth potential.

There is no stock account that gives the leverage real estate does, at as low interest rate real estate does, at as low risk/ volatility real estate does. 

If that investor hadn't planned it carefully and re-invested that money into the property or even the purchase of another then a recapture fee would hit them hard.