Help analyzing this 6 unit apartment building

[Gary Alford]

Hey guys,

I am looking at this 6 unit apartment building here in Norfolk, VA and just want to see what you guys think of these numbers. I wouldn't say she is super motivated but it still seems like this could be a pretty good deal. If I can not find a way to buy it I want to be able to wholesale it or just get a birddogg fee. Either way I still want to get the numbers right so this is what I got:

6 1/1 units @ $600/m each so  $3600/m altogether and $43,200/yr gross

Cost

5% vacancy= $180 building sits on a busy road and close to a busy intersection. 

6%repairs= $216

4% Capex= $144

Taxes= $263.35/m $901.98/q $3,160/yr

management @ 10%= $360/m

water= $450/m

Insurance= $60/m

total expenses= $1,313.35/m $1,5760.20/yr

NOI= $2,286.65/m $27,439.80/yr

Price= 245k

Which would put me at a 11% cap rate.

The market in that area for 1/1s is between 580-715/m with most being around $650 so it's sitting close to the bottom. 

The landlord pays water but if you separate meters and make the tenants pay water then there is a chance to increase income by $400-500/m. 

There is also a laundry room in the back that the owner says tenants used but she closed it and used it for storage because she needed somewhere to store supplies. So there is another opportunity to add extra income if you add coin wash machines. I honestly though I would split meters make them pay water and then offer free washing in the back just to entice people.

Now I haven't seen the inside of the units yet which I know I  must do but this seems good to me. Is there anything you guys can see that I'm missing or screwing up. Especially you guys that know the Hampton Roads area. Please let me know if I'm crazy with some of these percentages or something.

Thanks