Here's how I break down the 50% for my area:10% - property management10% - maintenance12% - taxes and insurance6% - vacancy12% - everything elseTaxes and insurance are pretty firm numbers, so I know that's accurate.

Here's the dead simple analysis:Investment $105,000Payment: $698 (7%, 30 years, $105K fixed loan)Gross Rent: $2600/monthExpenses: $1300/monthNOI: $1300/monthCash flow: $602/monthLooks like a pretty good deal, assuming all these numbers are accurate.

Let us know when you get the rest of the information needed to accurately access the operating expenses.

Ray,I will respectfully say that your comment about rolling over in bed while your friend goes to work may not be as accurate as you think.

even then to get an accurate picture, i still need to have access to the mls to see what properties actually signed up to be rented at though, right?

I use their interest rate and percent down to get an accurate estimate.

Landscaping, parking lot repairs, roof, etc.You need to get an accurate handle on what the market value is for the unit.

It does make a difference if it is REO.I've heard (not by experience) that some banks will notclose with anyone else other than who is named on the P&S agreement.Either way you can buy it with an LLC.It does sound like a good idea IF you are honestly accurate withthe comps and repairs are less than $20k.Ask the agent all the specifics on the property.

Ray's answer is accurate, but I think you're asking how to figure this out.

The problem a lot of beginning investors have, though, is they don't know a good price, they can't accurately predict cash flow or how to determine whether they'll have POSITIVE cash flow, and they don't have an exit strategy in mind when they buy a property.Educate yourself, learn your local market, and invest!