Analysis please: 8 unit building

[Mark Neiger]

Looking to make my first offer on a multi. This is an 8 unit, C-D class, concrete block in Florida. Half the tenants are section 8. Five tenants have been there for 10 or more years. One tenant has been there for 23. One is the on site manager. Gross rents should be 61,200. Current rents are 52,800 with one unit vacant. Expenses from last year 14,250 (about 23% of gross income). Asking 349,000. Pro forma puts it at a 13.5 CAP.

With current rents and 50% expenses it's a 7.5 CAP. Current rent, 50% and $325,000 gets me in at an 8 CAP.

Any thoughts. These type of buildings are being gobbled up at asking or just below in my area and I'm afraid to go very low and lose out. My plan is to get into SOMETHING with the intent of getting a track record for brokers / lenders and then get out and into stuff that makes better sense on paper.