12-14 unit apt building

[John P.]

hey all,

I am going to take a look at a 12 1 br apt building which comes with a 2 unit multi next door listed at $249,000. Parking in back (4 spaces). Its in an up and coming part of town which will see major growth 5-10 years from now. It also is 1 block from a small university. Currently the area is a bit shady.

Numbers: 12 1 br apt, Sep utit fully rented at $350 per. The 2 unit multi needs rehab and is vacant.

Annualized rental: $50400

Taxes: $6360

Insurance: guessing $4000

Operating expenses:$20440 (with reserves, maintence etch)

Noi: $29961

Debt service:$10488

Cashflow 19472---$1620 cashflow per month

I currently have a 3 unit that I owe 196k left on the loan but could sell for around $305k leaving me the money to 1031exchange for downppaymemt etch for the commercial loan and repairs

So do I sell my 7% cap $427 cashflow 3 unit in a nice area to risk on this?