If you can achieve higher than average returns on the reserve investment you can even reduce the annual amount invested a bit as the return will partially offset the annual amount needed.If you have multiple properties and are still funding up the reserve account amounts, you an borrow a bit from one property to cover costs for another but this approach comes with risks as well.Other ways to off set these costs are to establish lines of credit in advance of needing the money to fund the replacements or borrow against the property(ies) to fund the cap ex, but there is the additional interest expense to consider.Hope this helps.

Even if you have no interest in working with buyers or sellers you can always refer any that come across your lap to other Realtors in your area that are full-time Realtors and probably cover your annual fees and expenses to hold your license just with referrals.

When your cash reserves don't line up with your annual income, there can be many problems that follow including IRS audits.

Business strategy:  If I spent 40 hours working to figure out how to increase my annual income by $20K, that's $500/hour to raise money.I can't think of many other tasks that can generate $500/hour, so I tend to focus on those three.So, my recommendation would be, instead of spending time rehabbing your houses, spend your time finding more houses, finding more money to buy those houses and think about how to improve your business strategy to generate greater profits on those houses.Unless you'd rather just earn $15/hour...

Well, not so fast.Let throw in a curve ball and say your market appreciates at an average 5% annually like my market and history has shown that in the last 45 years. 

Is the lease paid monthly or annually?

You will have annual depreciation expense of $1,064. 

I'm wondering, with all the tax benefits to REI, what is everyone seeing as their annual tax responsibility?

State Property Assessment 189,400Arv 200,000purchase price 59kclosing 3.5total rehab  100krehab and acquisition 162.5k4 unit property, 6bd 4bth 3,232 sqftmonthly income  $2,900   annual $34,800monthly expenses $2,060 annual $24,720NOI $21,258cap rate 11.88%taxes 4,470Total operating expenses:Mortgage expenses:Vacancy:$174.00Repairs:$116.00CapEx:$29.00Electricity:$75.00Water:$50.00Insurance:$80.00Management:$232.00P&I:$932.08Property Taxes: 372.5

For my criteria the most important analysis I do is to figure out how much money I will be coming out of pocket and how much will I be getting back for that investment annually.