There’s a five plex in Juneau, AK for sale and I need some advise

[Gernot Bucheli]

The current owner needs to sell this property. He is asking $420k for it, has a outstanding VA loan on it for about $335k, and will take $370k minimum. I'm also VA qualified so I can assume the outstanding loan and just pay the minimum difference which is $35k. Each unit rents out for $1000 per month. And the mortgage payment is $2100 a month. So far it sounds great. Then comes the monthly expenses. I used BiggerPockets Four Square Method and the cash on cash return is 3.82%. Pretty low since is estimated rehab are about $75,000. All but one unit can use a remodel that can increase the rent to $1200 each. The math doesn't look good for now. But in 5 years and with all the rehab completed the five plex value will increase. Is my thinking going the right way? Any suggestions?