First Deal, Looking for some Feedback

[Patrick Vera]

Hi everyone,

Hoping you could take a look at this deal and help me see what I am missing:

Property is a condo constructed in 2003 and located in a college town.

Asking Price: 76,000
Cap Rate: 4~5%
Current Rent: 650/m 7800/yr

Expense Assumptions:
Vacancy - 10% (65/m)
CAPEX - 8.5% (50/m)
HOA - 90/m
Estimated Taxes - 120/m

NOI - 275

I am thinking of offering 62500 with 20%
Debt - 242.62

Monthly Cashflow = 32.38/m

This comes out to be a 3% Cash on Cash return. With a slight rent increase, the cash on cash return would be 4%.  Is this kind of deal even worth it?