I originally considered buying one of these properties as a rental, they rent fro around 1100-1200/mo, but after reading about the operating expenses it doesnt seem like I would make any money, maybe just cut even ($650 for mortgage/insurance/taxes, + $600 for expenses is a -50 monthly cash flow).

A preforeclosure sale [short sale] involves the sale of the property by the borrower to a third party for less than the amount owed to satisfy the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer.

this includes insurances, taxes, interest, etc.

Insurance premiums run $766 a year.Gross rents, with a 10% vacancy rate, would be $5,076.

Get title insurance, title search, and properly recorded documents.

Better off having an insurance policy built in, just in case.

Get multiple contractors to come out and let them know that you are having a couple of recommended contractors getting estimates for you.Remember the lowest bid isn't always the best.Many times after you have the written estimates in hand you can go back to the one you liked the best and ask them if they will match the other guys price.You also want to make sure they have insurance and are licensed.

Lets say replacement value is $150,000This puts taxes at 19% of rent and insurance at 16.6%.

Taxes and insurance can fall into holding costs, too.

Property Cost $200,000.00 Repairs Needed $50,000.00 Number Of Units 10 AVG Rent Per Unit $475.00 Gross Schedule Income $4,750.00 Vacancy Allowance 10% $475.00 Gross Operating Income $4,275.00 Less Operating Expenses Accounting $25.00 0.58% Advertising 0.00% Insurance $125.00 2.92% Lawn / Snow $- 0.00% Repairs $85.50 2.00% **Since i guess high for repairs, i lowered this down to 2% Monthly Taxes $458.33 10.72% *** Renter pays Utilities Electric $- 0.00% Gas $- 0.00% Fuel Oil $- 0.00% Water / waste $- 0.00% Total Operating Expense $693.83 16.23% Net Operating Income $- 0.00% Property Cost With Repairs $250,000.00 25% Down $62,500.00 Additional Cash Down $- Remaining Balance $187,500.00 Gross Operating Income $4,275.00 Monthly Mortgage $1,875.00 Total Operating Expense $693.83 Monthly Profit $1,706.17 36% profit My formula always shoots higher on the cost to protect me.