~~~~~~~~~~~~~SFH - 4BR/1.5B - 1300sqftPurchased for $49900 (30 fixed - 20% down) [rentable condition as-is]Rent Comparable - $1150/month10% property management8% vacancy15% repair/maintenance$400 insurance$2300 taxes$5k rehabEstimated Cash Flow - $358/month pre-taxEstimated Cap Rate - 13%Estimated Cash-On-Cash Return - 17% (includes estimated down payment, closing costs, reserves, llc formation, rehab)Estimated Full ROI - $23% (tax write-offs, mortgage pay-down)There is probably some captured equity in there too.

If you run the numbers on a very conservative side (10% vacancy, $1,500 taxes & insurance each, 5% cap reserve, 2.5% utilities, 10% repairs) you are looking at a NOI of $16,157.At a purchase price of $119,000, you are looking at a cap rate of 7.37.

I would try to get the bank to hold the note with a little down to preserve your cash reserves.

Investment property will most likely mean 20% down, no special first-time home buyer incentives, higher rates, points, fees, and reserves, and you'll probably need 2 full years of rental income before you can actually use that income towards qualifying for anything else.

Get rid of the debt, you'd have no reserves if you bought more properties, at that debt level if anything happened, you'd be sunk.

I have been the high bidder on one house 5 times and the auction ends in reserve not met.

Do you have enough in liquid reserves to put 20% down (usually required here in Ga at least) plus have 6 months in reserves for interest only payments and not put you in a tough spot.

Buy and hold is a long term strategy. it requires modest cash reserves for those unseen bi expenses.Flipping, and I assume you mean rehabbing, is a big chunk of cash now strategy.

With the fifth, you have to two years of tax returns per per property, six months reserves per property (in addition to your down payment) and a FICO north of 720.

You will build reserves to fix stuff (the capital expenses) if you factor in the 50% rule (you can find the discussion on the BP forum).As far as deferred maintenance, the seller doesnt get a free pass and cannot dump it on the unsuspecting buyer.YOU get estimates for heaters and new roof, and take it off the asking price.Somewhere in the middle, you will reach a deal.