Also, I would never estimate a renovation budget based on square footage.

Lot's of red tape and time for me to make only 3,000 - 6,000 on 200k sales price.Someone else calls me up and says they have 700k cash of their own to invest and wants to buy a 3 million apartment building.

@blake @Blake Byrd a fellow Red Raider!!

As a CPA, I make complex things simple and simple things complex.I have a formula of Square footage x avg SF rents (Avg sf rents is from phone calling Sunday ads)(Since I only buy close to downtown (e.g. yuppies) I add $100 on top of this)Less PITI -Principal, interest on 10-20% down on 15yr mortgage -Taxes, insuranceLess depreciation=tax income+ depr (add back) - principal payment (deduct)=cash flowMy "business model" is net $200-300 per house (yours can be different)Agree w prior posting that debt service is arbitrary re 15 yr vs 20 vs 30 yr; % down; etc.I have a very successful friend who never pays 60x rent.

Too many other red flags for me going up.

A general rule of thumb I use is that it costs me $1,000 per square to completely gut, rebuild, and update an entire apartment.

I'm planning on (1) target potential, newly-listed leads (2) compare to similar properties (similar square footage, same number of bedrooms and baths, and in the same neighborhood)  that sold within the last 6 months (3) go physically inspect homes that seem to be listed below market value (4) if I see nothing wrong with the home, put it under contract and present it to my investors listAm I on the right track? 

Also agree, red flag.

If you dont have a scenario that pertains to any of these 4 then you'll need to refinance out your current FHA loan subject to qualifying for a conventional loan (credit, income, assets/value, etc) in order to be eligible for FHA financing again with low money down and red hot smokin letter of explanation.Hope that helps (above - this is why shopping for .125% in rate can cost you major opportunity cost)

For example, there's a couple of homes in a nice middle to upper middle class neighborhood near Watauga that are going for about $180,000. .15 acres with about 2,300 square feet.I'm not sure where to begin to evaluate those properties to determine if they would be a good rental investment or not.