Get that initial project at the minimal purchase possible and have at lease 1.5 - 2times over your initial deposit for the unexpected.

I target $10k right now because it's a good amount to have to cover any potential unexpected expenses for 4 houses.

The only time I had someone leave unexpectedly was an inherited tenant and it was a blessing.

Even though you can use other people's money to purchase and rehab, it seems like you'd need a certain level of cushion for unexpected repairs, vacancies, or emergencies that might come up before the property has had enough time to build up its own cash reserves for such things. 

There's always something that can go wrong, but the numbers are so low that any unexpected repair would make this a waste.

Super sad but my real estate agent unexpectedly passed away around a year ago.

@John Sherwood if you want to be really scientific, then break down every component of the building into its useful life.

We were fortunate enough not to run into too many unexpected expenses during the rehab, so the projections with the added cushion was more than enough to cover the work (even with having to buy 2 brand new water heaters a couple weeks apart).As far as management goes our project manager is an extension of our property management company, so they get a % for managing the work and are equally incentivized to make sure the work is done right as they will also be managing it long term.

Hard money could close within the timeline, but it would best suit you if there is a rehab component to the loan.

I have used 2.5X rent to income on these C class properties to obtain applicant interest and have not gotten burned by it yet (I suspect I will eventually because these tenants simply do not have much margin to deal with the unexpected).The people who rent the lower cost units are used to living on lower expenses.