Can you think of an increased expenditure that has caused a significant RE price decline in Coastal So Cal?

From my knowledge from combing through bigger pockets I was planning to add up - 50%(expenditures + vacancies) + PM fees + EMI. to answer your question about, whether it is being strict - I think its always good to be on the conservative side rather than being on the aggressive side.

There are some pros and cons, but as long as you incorporate all of your planned expenditures into the front end of the deal, you'll be fine. 

The other major expenditures like Windows, boiler, and roof have all been taken care of in the last few years.

As a result, I didn't include a separate CapEx expenditure as my belief is the $4,673 maintenance/repair item would act as a method of capturing CapEx, capital reserve building going forward, and turnover costs.

NOI does not  include debt service (loan repayment) nor should it include capital expenditures.

Single family home in need of some TLC for sale in western PA for $39,900.Median house price in the neighborhood $75-80kAverage rent for a similar property in that zip code $850-$900I would be putting down 20%, 5% interest, 30 years.Allocating $15k for rehabTotal cash needed $24,177Rent: $900/moVacancy: 5% ($45)Taxes: $238/moHome Insurance: $38/moMaintenance: 8% ($72)Capital Expenditures: 8% ($72)Utilities/Landscaping paid by tenant. 

You also have the advantage of doing all your cap ex (capital expenditures) up front.

We purchase and rehab everything and fix it to the 9's to avoid unexpected capital expenditures.

@Wave TaylorI purchased a turnkey 3 family home 10+ years back in a C+ area and even though most of the improvements had been done, there were still a few capital expenditures that had to be handled within the first 7 years.