Help Analyzing Small Multiplex Property in Kansas City

[Michael Catausan]

First of all, I am a newbie RE Investor and just starting out on BP and enjoying reading all of the helpful posts.  I want to be a helpful contributor eventually but you have to start somewhere.  I have read a few recommended books, viewed several podcasts and went through many forum posts trying to help me find and analyze deals but I believe with the ever changing market that some information may be dated already so please forgive me for asking similar questions that have already been covered.   I am looking at a property in Kansas City in what I believe is in a C Class neighborhood.  Here are the numbers for a 4plex in Raytown MO (Suburb of KC).

Purchase price: 200K

Repair/Rehab Costs: 10K 

ARV: 210K

Financing with 25% down at 4.5% for 30 years (150K Loan)

Total Cash needed $65,806 (Down payment+Rehab+ClosingCosts)

Monthly Income $2375, Monthly Expenses $1939.86 with NOI $14342.00

Expenses (Vacancy 7%, CapEx 5%, PM 8%, Tax 6%, Repairs 11%, Insurance 7%, Snow/lawn 6%)

Cash Flow $435.14

CoC: 7.93%, Pro Forma Cap: 6.83%, Purchase Cap 7.17%

All numbers were taken from BP calculator and my estimates are based off of last years figures because the apt is fully tenanted.

My concern is the CoC and Cap rate seem low for a C Neighborhood and my initial cash outlay also seems high. I am hoping you all may be able to shed some light on KC market currently to see if this deal is worthwhile or too risky and should pass.

Thanks for everyone's help and I look forward to many future deals!