He will track the exact expenses associated with any property and even apply the business expenses that are not directly associated with any property (such as the wages that your business pays you) across the board evenly to all properties before comming to a conclusion as to any property being a true cash flow property.So the 50% cash flow property and a true cash flowing property are two different things totally.The 50 percent rule only says that OVER TIME you will AVERAGE 50% of your rent in expenses.Using the actual accounting method of income vs expenses for cash flow does not make allowances for the future expenses that will come if you hold the property so you will have to tap your own reserves for any of those repairs.

You get a signed contract after having walked through the house with the seller and everyone came to the conclusion that repair costs would be $20k.Then, you later discover that they are really $28k.

Closing table, property is assigned to the buyer, and then the seller is responsible for whatever is pre-owed on the property after the conclusion of the contract?

That's actually part of the reason that I'm now mostly looking at SFRs and before it was multi-family.I've come to the conclusion that I'm likely never going to get an "A" neighborhood rental on a "C" neighborhood budget.

Thanks @Page Huyerte and I'm looking forward to the conclusion!

You say you have to gut the kitchen/bathrooms...why was your PM able to come to that conclusion but you had not?

Every time I look down this road, Ken, I end up at the same conclusion.

I have been doing tons and tons of research along with reaching out to network over the last 6 months or so and have come to the conclusion that becoming successful will take either a substantial amount of time, or money, or both.

Brandon:  If you had existing leases at the time of the fire with tenants paying $600 per month, then you can discuss with the appraiser the appropriateness of his rent conclusions.  

You can draw your own conclusions after looking at it.TAR Texas rental report