With the cost of eviction, vacancy, and turn around, I could very well suffer negative cash-flow for the year.

Make sure you budget for maintenance, vacancy and turnover costs.

I am pretty sure it will.Overall the house does "cash flow" after accounting for the 5% vacancy, 10% property management, 10% repair and mortgage payment.The sellers are old school in their mid-60.

You also need to take into account maintenance, vacancy and who is paying utilities.

Since most of my tenants are long term (over 5 years, some over 10 and two over 20) I will not hesitate to reno when needed instead of waiting for a vacancy, especially when there is a structural need or health risk at hand.Here is the previous thread on this topic.http://www.biggerpockets.com/forums/52/topics/118940-anyone-renovate-while-unit-is-occupied

Here is a possible scenario.Rent $1,000.00HOA $190.0010% Vacancy $100.00Marketing/Gas/MISC - 2% $20.00Propery Management -10% $100.00Mortgage (If Any) $250.00Expense $660.00Cash flow $340.00 (Less then 50%)

You can charge market rent on the unit due to vacancy decontrol.

The economic vacancy (skips, lates, etc.) may be much higher than you expect.

CAP rates and vacancy rates have no room for further compression and rents have already increased with little upside remaining.

That rule of thumb says expenses, capital and vacancy eat 50% of the gross rents.