Calculate your bottom line using 70% of ARV (After Repair Value).Do not spend more than (.7*ARV)-RC (Repair Costs)Example: House is appraised at $100,000 *if repairs are made*...7*100k = 70k.Repair costs are expected to be $25k. 70k-25k = $45,000 (DO NOT BUY THE HOUSE IF IT IS OVER $45k)Take another look at the ‘going rate’ of rent in your area, make sure your cash flow is enough to cover ALL costs and include a buffer for taxes and unexpected repairs.Look at the property yourself - try to eliminate assumptions.Have a trusted professional assess and confirm info about repairs that may have been overlooked.Look at how much work you can do on your own and compare it with contractor rates to complete all repairs.

., cap rate is more of a metric to compare and value commercial properties.

Given that a comparable down the road just sold for $229,000 and spring is a hot time of year for real estate, her realtor probably gave her a fair estimate.

If you are paying 10%, that's pretty high compared to conventional 30 year fix at 5.25%.

Get some more data in your system so you can actually see if its working(compare round to round).

When comparing to deals in my areas, I would definitely say pass.

I would also check local rents around to see if it's comparable with the annual rent they claim to be getting. 

When the reward is multiplied by multiple properties the bumps are easier to survive.It is not a question of whether one property can be profitable it is more a question of whether one property is worth the effort based on that profit.

If you qualify for it - this would be much better choice compared to SD IRA. 

Now, if I take a reasonable valuation of about $1.1m (the slightly smaller, less nicely renovated house literally two houses over sold for about $1m a year or two ago) and throw that into a mortgage calculator with 20% down and comparable taxes/insurance, I get about $4,500/mth.