I was looking at a retirement city that has 25% vacancy rate.Here is some other data:-population 21k-population growth 14% (since 2000)-median sales price 129k-year-over-year return -12%-quarter-over-quarter -14%-sales price 5 years ago 192k-2006 sales price 270K-median rent listed 1250$ (-22% change since a year ago)I like the fact that there's definitely room to grow (between 2006 price and current), however I am concerned about 25% vacancy rate and decreasing rents.

I want to be hands for the first only to get a better grasp on the whole process.Rent @ $700 is conservative.If 5k purchase--NOI 3840, 12% coc, beats 2% rule.If 10k purchase-only 10.3 cocPlan to pull the equity out after 6 mo, so the cash on cash will increase while the NOI decreases.

You will run into an issue of transferring the funds out of the S-corp if you basis is zero.Profits increase basis.Adding money increases basisTaking money out decreases basis.

So, putting an extra $10k now (as an example) would mean that your loan balance decreases faster from here on out to get you to the magic 78%.

:)Historically, real estate has tracked inflation, so holding real estate for a long time is more of a hedge against the decreased value of the dollar than it is an automatic wealth builder.Of course, when you combine time with all the other factors you mentioned, that's where the money comes from...

Purchasing property with no down payment significantly decreases the potential universe of property available for purchase - again achieving positive cash flow can be done, it's just much more difficult.Good luck!

It also helps to increase productivity and decrease feeling of isolation.

The property is rehabbed and looks good, why not have your agent or another agent specializing in rental management take over and do all the work leaving you without the time commitment, just the positive cash flow.I sort of see your agents logic, the foreclosures have torn apart certain areas and have decreased the values of ALL properties there.

Decreased or increased rents?

I'm also assuming 92% occupancy, and if occupancy decrease, I'm out the bill.