How to work out cashflow

Hi folks,

I’ve just finished Steve’s book and it’s a great read, it gave me loads of ideas. However, there is one part of it that is bugging me I hope someone may be able to clarify.

I setup a spreadsheet like what is on Page 87 to work out my cash on cash returns. I replaced the “Repairs budget” with annual outgoings such as insurance and management costs and now find that my duplex that cost $125k and rents for $230pw actually has a negative cashflow before tax is considered.

Am I missing something here?

thanks

tim