Less than that, once you subtract out the interest since the last payment, all the cleaning and fixing costs to get it into condition where it will actually sell for "what its worth", and some of the buyer's closing costs you have to pay these days to actually sell a house.

If I add in closing costs (2% of the sales price) and subtract the down payment, I get a monthly payment of $857.

Take your ARV, subtract repairs and the amount you want to make on the deal.

So if you will rent the house for $1500, you would subtract 30%, or $450, for these items.

Also realize that when you sell a property you will need to subtract 7-10% for all of the closing fees, agent commissions, etc.

For an initial evaluation, I just apply the 50% rule (expenses, vacancy and capital will eat 50% of your gross scheduled rent), then subtract out the debt service (P&I) to get cash flow.Really, really tough to start in multiunits unless you have an experienced partner and a good pile of cash for a down payment.

From there some investors, to gauge their net operating income, will subtract 50% to account for operating expenses.

You just take the Net Operating Income (NOI) which is all the income the property generates and subtract your Operating Expenses for things like Taxes, Insurance, Management, Maintenance, Utilities and Reserves (TIMMUR).

Shouldn't we subtract the repair cost from our total equity?

Keep in mind that every day you don't find one, subtracts from the 21 day limit you self imposed.