- What's the annual rent increase % you want to apply to the income on the properties?

List Price $ 109,900 Fair Market Value $ 97,900 Discount (%,$) 23% $ 22,517 Purchase Price (Max Offer Price) $ 75,383 Percent Down 3% Down Payment Amount $ 2,261 Amount Financed $ 73,122 Interest Rate 4.00% Costs of Repairs (Make Ready) $ 5,000 Length of Mortgage (Years) 30 Payment Monthly Annual Monthly Mortgage Payment $349.09 $ 4,189.12 Rental Income Monthly Annual Unit A $ 700.00 $ 8,400.00  Unit B $ - Gross Rental Income $ 700.00 $ 8,400.00 Vacancy Rate 8% Net Rental Income $ 644.00 $ 7,728.00 Expenses Monthly Annual Property Management Fees $ - $ - Leasing Costs $ - Maintenance Reserve 32.20 $ 386.40 Utilities $ - $ - PropertyTaxes $ 121.42 $ 1,457.00 Insurance $ 129.50 $ 1,554.00 Other (HOA fees, Lawn Care, Trash, etc) $ 6.67 $ 80.00 Total Expenses $ 289.78 $ 3,477.40 Net Operating Income $ 354.22 $ 4,250.60 Mortgage Payment $ 349.09 $ 4,189.12 Total Cash In (Downpayment + Repairs) $ 7,261.49 Net Cash Flow $ 5.12 $ 61.48 I worked backwards to see at what price do I earn a profit/ break-even my first year.Thanks for any advice in advance!!

The nice thing about living in a market and investing in a market like Spokane is the cost of living is low, so you don't need to scale to much to be able to do that, to have 60k in annual income in Spokane probably should only take between 8-10 regular rental properties, and with a purchase price of 60k-100k it's pretty easy to do if you have some capital to start with.

Still, REOs were less than half their peak of 102,134 in September 2010.REOs have increased the most from a year ago in the following states:Florida: +78%California: +23%Texas: +187%Georgia: +87%Michigan: +129%Ohio: +69%New Jersey: +344%Meanwhile, foreclosure starts have fallen to pre-crisis levels and are down annually in 31 states, RealtyTrac reports.

Because that rent would cover my cost of acquisition and nearly all of my annual costs and at 5% a year appreciation is giving me another 1625 a month in additional equity growth...as well as depreciation, as well as expanded portfolio.So it's really what makes the most sense at the time for the investor relative to their strategy and goals.Good post!

I've seen this formula,  annual area average rent * 15.

Yes it can be done, but realize that with a license comes annual fee's that cannot be avoided if you want to maintain access to the MLS and other things like dotloop and showing services.Annual cost is like $1,000 + for a cheap broker and potentially much more if you become affiliated with a national broker that will ask for more monthly fee's to maintain marketing and nice office space etc.

I own 2.5 acres free and clear, except for the annual taxes of course...

The property has a NOI of 28,800 annually, so it was a pretty decent investment even at 287.9.

I'm sorry to be so blunt but if you don't know how to total up all your annual expenses and divide them by your projected income to get a cap rate you should not be investing in real estate.