@Darren Budahn & @Dawn Anastasi, this makes good sense for a SFH, I like the incentive for the tenant to manage their own consumption.Regardless though, if I reduce rent and the water bill is paid by the tenant, it should really be a wash over time in regards to Expenses as a % of Gross Income.Reworked the numbers for my example:Gross Income: $1035/mo rent, 4.2% Vacancy Loss (1 out of 24 months) = $11,902/yearExpenses: $3,200 Tax, $560 Insur, 5% Opex ($595), 10% Capex($1190), 10% PM ($1190), Water Bill (Tenant), and Admin/Advertise ($75) = $6,811/yearNet Income: $5,266/year and this puts the Expenses as a % of Gross Income at 57.2%Still am over the 50% rule though, my only other variable seems to be to pin down Opex/Capex harder (which I would do regardless), but is it unrealistic to regularly forecast 50% for SFH in West Allis/Milwaukee area?

Well ideally that is the goal of every property you pick up, espically in this market due to many factors (mostly increasing material costs) it is a very unrealistic expection to find a proprety in which you are able to pull out all of your money. 

In the last few days I’ve done more research and I think I’m realizing my expectations for capturing 80-85% of the building value for bonus depreciation is likely unrealistic.

However, I'm also worried about "the headache" of dealing with unrealistic home owners.

If you enter into business with them from unrealistic perspective, it is bad for you and worse for REI Nation.REI Nation has been around forever and they are one of the most trusted turnkey brands.

Perfectionism: Some investors set unrealistically high standards for their investments, aiming to find the "perfect" property or deal.

To me, this is just logic, and there is no need to feel personally attacked by it.You absolutely made your post sound like you do all this with D4$, and when I showed you how unrealistic this is, you completely changed your story.You even advised them to do driving for dollars because you do 120 deals this year.

Anything in that price range is generally going to be in a rough area.In general, the ones to avoid are the ones that: Don't allow financing or a finance contingency (it can be a good indication they are selling above market value) Don't allow for your own independent property inspection Are not realistic with their pro forma's (i.e. they don't include vacancy or maintenance projections or use unrealistically low vacancy factors) Require you to pay for any renovation upfront Sell only in cheap. low end neighborhoods Don't accurately represent the neighborhood/property classification Don't have consistent rehab standards for all properties Don't provide a scope of work for the property Can't provide references of repeat investors Require you to close before a tenant is in placeIf Indianapolis or Kansas City are on your radar, I may be able to help.

Anyone holding out waiting for some payday or vindication has a unrealistic view of how these type of things turn out. 

This is not unrealistic depending on where the home is located.