High Property Tax rates on SFH rentals in Indy
Hello, I'm an out of state investor who just started building a portfolio of SFH rentals in Indianapolis. Got 2 properties under contract (in Carmel and Fishers (yay!), but one thing caught me by unpleasant surprise: Property Taxes for rentals are crazy 2.1 - 2.3%!
How do you fellow investors managing that? I mean, I cannot apply Homestead deduction, any other means of managing this number?
For context:
I was targeting 8% rent to price ratio as reasonable (I know it's low, but I'm in the long-term game and little to no cashflow is ok with me, as long as it's positive with 25% down). So having 300K house, renting it for $2000 per month seemed fine. Costs would be:
$950 - P&I; $200 - PM fee; $110 - Insurance; $50 - HOA;
but when I substract $570 Taxes it leaves me with $100 monthly on maintenance. Ok, I probably can try to rent it out for 2200, but still very thin margin.
Those are sample numbers, but they are 95% close to exact numbers on one of the properties.