Stress-test the deal, not the headline yield.
Start with measured local price, rent, mortgage-rate and property-tax evidence. Then test transparent downside rules, solve the true break-even rent and find the maximum price that still reaches your target.
What is measured, assumed and deliberately absent
Four inputs are measured and named: the median home value and median rent for the market, the 30-year mortgage rate from Freddie Mac’s weekly survey, and the effective property-tax rate for the county—median tax actually paid divided by median home value.
Insurance, vacancy, maintenance and management are not measured for a specific building. They remain visible, adjustable assumptions. A quote or operating history should replace them before a purchase decision.
Downside and severe cases are editable arithmetic rules—not projections or probabilities. There is no appreciation, rent-growth forecast, income-tax treatment or exit value. Missing property facts stay inputs because a precise invented expense would be worse than an honest blank.