But there was still a contingency period in there.A lot of these replies seem to be confused as to what you're asking for - you're asking for an inspection contingency period, not for them to make any repairs or price reductions.  

Hearing the tales of price reduction after price reduction and monthly shortfalls certainly tell a different tale then the boom days of not too long ago.

It may be spelled out more simply in the RE statutes, but in the lead laws it says that if the state believes there's a "lead exposure hazard" for a child they can open an investigation that includes "issuing orders requiring the reduction of lead exposure hazards".

Fortunately we found out just before closing and negotiated a small price reduction to allow for the electrical work and permit costs. 

everything I would say has already been mentioned by one person or another. at the end of the day, paying off the loan first is a risk reduction move rather than a right or wrong move. my main focus would be evaluating how much the student loan payments eat into your debt to income ratio. $8,000 loan?

Can you elaborate more on the negotiations and price reduction?

I am leaning towards seed money my wife is leaning towards debit reduction.

Maybe get rid of the 10% buffer if you already have a lot of science behind the estimate.Maintenance - As others have said, the maintenance number is too low (especially for 100% turnover) but your combined maintenance and cap ex do not appear too low.Appreciation and Principal Reduction - Cash flow is one of three profit drivers in real estate and to calculate the true return, factor in the other two drivers using the IRR.At a 60% expense rate for a $1450 rental, you are likely forecasting expenses a little on the high side (even with the higher taxes) but you may not be too far off (and the tweaks I mentioned may help).

What will most likely happen is a gradual reduction in the rate of appreciation until we get back to a more balanced market. 

The seller could credit $12,345 to you at closing, instead of, say, a similar price reduction.