Do they know something I don't?

[Debra R.]

I looked at this property a couple months ago.  

https://www.redfin.com/CA/Oakland/1124-16th-St-946...

There's nothing special about it.  Not a good neighborhood, not a good school district, needs a lot of work structural, electrical and cosmetic.  There's nothing charming about the apartments.  In addition, it is under rent control and just cause for eviction.  It comes with 2 tenants.  The buyer won't be able to raise the rent on them more than the city dictates (which is historically around 2%/yr) and can't easily get rid of them.  

I did a BP analysis on this property and underestimated expenses.  I still couldn't get it to even break even.  Yet, the property had enough offers on it that it sold over asking.  

What am I missing?  Is this market so hot that people are making ridiculous decisions? Or is there some method of making money here that I don't know about?