Onto, I would consider 1% the absolute floor, and that is for a property in amazing shape in an area that is going to appreciate like crazy. Most of mine are in working class or lower middle class areas...not slums but not places I would be happy living. I have a couple in the 1.5% range and these are in desirable parts of town, so appreciation will be strong, while it will be nonexistent on the others. I do not buy for depreciation though, as it is deferred and uncertain. I consider it speculation. I buy for cashflow only. My mentality may shift when cashflow gets to the point where I can't spend it.
Your breakdown needs about 15% for vacancies and maintenance. I also do not pay for water or lawn care...the tenants take care of that...it's in their leases. Insurance looks good. Taxes look insane. I know this varies widely by geographic region, but on a $250k property here I would be paying probably a maximum of $3000/year. If you are not going to self manage, add 8% for property management, or probably 10% if you only have 1 property since that's more burdensome for the manager.
Your breakdown needs about 15% for vacancies and maintenance. I also do not pay for water or lawn care...the tenants take care of that...it's in their leases. Insurance looks good. Taxes look insane. I know this varies widely by geographic region, but on a $250k property here I would be paying probably a maximum of $3000/year. If you are not going to self manage, add 8% for property management, or probably 10% if you only have 1 property since that's more burdensome for the manager.