Ask opinion for a rowhouse in 21239, Baltimore city (rental)

[Ken Wang]

Dear Investors, 

  Here is the deal I am seeking the opinion.  

Row House in zip code '21239' in Idlewood community, Baltimore : 3 bed/1.5 bath

Trulia data: low crime rate

Age: 1953

Asking price ~ $120k

Proposed offer price: $90k

Roof & gutter: 2010

HVAC > 20 yrs

Hot water heater: recent

Plumbing: copper 

Closing cost: 7k

Repairs and MISC costs: $5k (Paint, lead certificate, patio fix, rental registration, cleaning, and unexpected cost)

Down payment: 20% (30 yrs, investment loan)

Loan rate: 5% 

Rent total: $1400 (below rentometer average, and I have checked recent listing as well) 

P&I: $387/mo

Taxes: $198/mo

Insurance: $50/mo

Lawn care: $40/mo

Ground rent: $8/mo

Vacancy: 8.3%  (1 month vacancy/yr)

CapEx: 18% (for this > 50 yrs old house)

Property Management: 10%

Cash flow: $210/mo

total cash need: 30k

Cash on cash: 8.4%

I have a few specific questions and would like to learn from you guys;

1. I have done my homework but would like to ask if I am being too conservative. 

2. Related to the 1st question, I have been searching rental property for a while in Baltimore city and close to west side of Baltimore County.  It seems difficult to see > 8% cash on cash return after considering all the expense, neighborhood, property condition and potential tenant category. After all, for this property, I can only get $210 monthly cashflow. I am wondering am I not looking hard enough or it is normal for Baltimore or surrounding market these days? I am not looking for low-value property but in a reasonable neighborhood to get a steady income. 

Any comment/critique is welcomed! Appreciate your time to read this list.

Sincerely,

Ken