Your thoughts on these numbers ...

[Henri Meli]

Brick construction, 20 units , Built in 1970, Location NC, Area characterized as Class C. I drove through the area, there are new constructions happening on that street and the streets nearby. Property is master metered. All units are 2 bed rooms, 1.5 bath. Vacancy rate 85%.

As of today, all units are occupied @ $550 per month in average.

Below are the 2014 numbers. I also have the 2015 numbers (Jan - June)

Income (Jan - Dec 2014): Rent $ 100,810.00 

Expenses (Jan - Dec 2014):

Taxes:  $ 8,300.00 

Insurance:  $ 5,500.00 

Exterior lights:  $ 1,200.00  

Water, Sewage, Garbage Collection:  $ 11,500.00 

Repairs and Maintenance:  $ 16,000.00 

Total Expenses:   $ 42,500.00 

Net Operating Income $ 58,310.00 

Asking price $ 600,000.00 (about 30k/unit) 

CAP RATE 10%

Roof replaced in 2012. 40% of HVAC Units are less than 2 years old. All other HVACs are still functional. In dire need of landscaping and interior upgrades.

Any feedback (positive or negative) would be appreciated. 

[Justin Fernandez]

By Vacancy, did you mean 15%? 

Master Metered includes electricity as well?

Room to improve the rents?

Room to cut expenses? They do seem low though. 

Are you going to self manage or use a PM?

If you set the expenses to 55%, that gives your roughly 45K NOI, with a 10 cap that gives you 450000. With your numbers holding it at 583000. So double check the expenses for PM and Electricity because that looks like a 133K difference.