How much Cash-on-Cash ROI and Cash Flow is enough on BRRRR?
I have been a BP member for a few months, and have watched/listened to every webinar/podcast I have been able to get my hands on. On those, @Brandon Turner usually mentions (for BRRRRs) that a desirable cash-on-cash ROI should be over 8% (ideally 12%), and that cash flow should be at least $100 per door. Both of those seem pretty reasonable, and I agree with them.
My question is regarding the parameters to get to those numbers. I have seen Brandon use the BP calculators to get these numbers, which typically take into account 25% of the rent for vacancy, property management, repairs/maintenance and capital expenditures; while others (i.e. local wholesalers) calculate them without taking those into account (i.e. Cashflow=Rent-PI-Taxes-Insurance)
Of course Brandon's approach brings more peace of mind, and make more financial sense, but I would like to hear some different perspectives on how everyone out there is calculating (and taking decisions) around these ... What is your ideal cash-on-cash ROI and minimum cash flow? (SFHs and small MFHs)
Thank you.