Is there any profit in this deal.

[Oscar Almonte]

In trying to get a grip of multifamily properties investing, I know with my criteria what I am willing to pay. I have recently been looking at some multifamily that have been sold on the MLS in the area that I am focused in and I just do not see what the person that bought it is seeing after crunching the numbers. Am I missing something. Can some savvy investor shed some light. This is a 3 unit.

PP 529k

Closing cost say 2%

FHA

Rent $4,495

Taxes $9,218

Water for MF for the area $51 monthly 

Without expenses this person is only making 520ish  after I plug in the data.

When I put my numbers of 5% repairs, 5% cap ex, water 51, vacancy 8%, PM 10%

I will be losing 7 hundred and change a month and will not cash flow until year 15.

I am over analyzing or missing something.  Thank you....looking for some clarity. 

[Bonnie Low]

It really doesn't matter what another investor is paying for the property because there's no way for you to know what their criteria or motivation is. Maybe they're going to house hack it. That would produce different numbers. Maybe they're looking for a write off. Maybe they're running out of time in a 1031. Foreign investors put their money here for security and appreciation - neither of which are available in many other countries. Maybe they have a high degree of risk tolerance. Maybe they know someone in City Council and know that area's about to boom, maybe they're terrible at running numbers themselves and don't know they're going to lose money or they don't care....there are just WAY too many possibilities.The bottom line is that it ONLY matters if the numbers work for you. You'll drive yourself crazy if you look at it any other way.