35% is counting vacancy and overhead expenses.

Vacancy
Vacancy Rate @ 10%

Operating Expenses
Fixed
Property taxes
Insurance

Variable
Property management
Maintenance
Legal Fees
Accounting fees
Advertising
Administrative expenses
Extermination
Landscaping
Trash Removal
Pool/ Recreational area maintenance
Utilities
- Sewer
- Gas (propane, oil, natural)
- Water
- Phone
- Cable
- Electric