Underwriting assumptions for smaller multifamilies

[Carmela Gonzales]

Hello everyone. Looking to acquire a small apartment building, Class C, 10-40 units. I am actively analyzing deals on and off market to gain more experience. We plan to buy and hold for at least 10 years.

Obviously I try to verify everything thru the T12, rent rolls, etc but as a quick back of the envelope calculation I use 5% for vacancy, 8% for R&M, 8% for CapEx, 10% for management, 250 per unit for insurance. We are in Ohio, and most apartments here were built in the late 60s or early to mid 70's. Should I be more conservative in these assumptions? Thank you!