Next is a burial policy. 

Here is what must take into consideration.1.Income:Rental income=$2000Laundry=0Storage=0Misc=0Total monthly income:$20002.Expenses:Tax:$150.00Insurance:$100.00Utilities: Electric, sewer, water, trash and gas:$0.00HOA fees or Home Owner Association:$0.00( it will only cost nothing if the home is not located in a HOA area.)Lawn care:$0.00Vacancy:$100.00Repairs:$100.00Capital expenditures: $100.00Property management:$200.00Mortgage(only if you don't pay cash):$860.00(Assumptions about mortgage:Put down money for a down payment.Get a $160000 mortgage with 5 percent interest in a 30 year span.)Total monthly expenses:$1610.003.Cash flow:Income:$2000.00Minus expenses:$1610.00Total monthly cash flow:$390.004.Cash on cash ROI or return on investment:Down payment:$40000Clothing cost:$3000Repair money or rehab budget:$7000Misc other:$0.00Total investment:$50000$390.00*12=$4680.00Annual cash flow=4680Total investment =500004860÷50000= 9.36 percentCash on cash ROI is equal to 9.36 percent.

@Alex KovalenkoI think you are missing Vacancy, property management fees and capital expenditures.Vacancy = your property will not be 100% occupiedProperty management fees = you may be self-managing but you should factor this in as you may decide to oursource this function in a couple yearsCapital expenditures = i understand you have a budget for repairs but i consider those to be accidental items.

Cash on cash ROI of 25% (mortgage+interest, 10% property mgmt fee, 5% Vacancy, 5% Capital Expenditures, Insurance, Property taxes, Water & Sewer).Property is in great shape, just needs some elbow grease in the kitchens ($2.5k) and we're good to go.

Capital expenditure or expense.Repairs before it is ready for rent ARE BOTTOM LINE capital expenditures no ifs, ands, or buts about it.

A spending diary records the amount and purpose of each expenditure, whether it is something you pay for in cash, check, credit card, whatever.

Which at first glance seems like a lot, but one wholesale deal covers the entire expenditure for the campaign.Final question - when mailing to probates, how often are you sending mail their way.

Yes, this is the place you can get a graduate degree in real estate investing without a big capital expenditure.

You are going to have vacancy, maintenance, capital expenditures, special assessments and various other expenses that are going to eat into the $300/month cashflow.You absolutely can refuse to rent to someone based on the results of your background check/credit history/salary, etc.

It includes significant repairs and rehab in year 13 along with long-term cleaning and maintenance, repairs and cap expenditures.