Hi Sr's,I am planning to purchase my first rental townhouse in central NJ.Would you be able to take a look & let me know how am I doing with my numbers(Hopefully I didn't screw up big time)I ran the numbers with below info & got 200$ of positive cash flowPurchase Price:150000Repair cost:30000Rent:1850ExpensesHOA:300Property Taxes:5500Interest rate:5.5%Vacancy rate :10%Value after repair 215000Thanks for checking out.

It was rented at $640/mo (well below the median in Indy.)

From my research, a lot of investors spend renovation money in such a strategic way that all their money of reno's is back with them in 24 months (Example below).

Example below monthly expensesPrinciple and Interest (Mortgage). $600Taxes 200Insurance 50Total expenses $850Add in vacancy, maintenance, capex.Rent $1300Expenses $850Cash flow $450Minus other expenses.Remember at the end of the year you are able to write off on your taxes.Mortgage and Property Taxes and any other expenses plus depreciation You can take advantage of appreciation but don’t count on it.  

What neighborhood star would you recommend for my filter as a minimum?

Option #2 Purchase a small multi to house hack and rent remaining units and do a cash out refi on my current home and save the money for future down payments and rent my home even though it will be below the 1% rule.

I would go to where homeowners have the most equity, so they can sell far below value, and often still collect much more than what they paid or what they owe. 

I linked it below. 

Main criteria is you need an llc, typically 80 - 90% loan for purchase, 100 rehab, and ARV needs to be below 75% ltv. 

They'll filter all the cold leads, update your crm and you just handle the hot leads from people who actually want to talk.As far as direct mail, build a relationship with a mailing house and let them send bulk marketing mail for you.