Duplex in Northwest Indiana

[Account Closed]

Hi BP Nation

I invest remotely in NWI, and live in CA. 

I'm looking at an off market duplex in Hammond Indiana. The asset class is not exactly what I was looking for, I would probably call it a C (although I know this rating system is a completely arbitrary measure of risk). The nearest cross streets are Calumet and Sibley. I've been advised by a couple of professionals out there that its not the best area and not terrible either. Looks a bit rough on G-maps.

Here's the bit of info I have right now. Updates to come as my contractors give me a video walkthrough later this week.

Purchase Price: 55,000

Each Unit: 3 bed 1 bath. 

Condition: Roof, windows, furnace, ac, water heater brand new within 5 years.

Rehab: 10-15k cosmetics

Combined Rent: 1600 (800/unit) this is conservative. 850 realistic w/ good finish quality.

ARV: 80k (conservative)

I don't think there's much wrong with the deal from a cash flow perspective. After a fresh rehab, with durable materials put into the house, and a manager referred to me by other investors in the area.. I'm writing the pro forma @...

8% mgmt, 12.5% maint/repair/capex, 7.5% vacancy: 450$

Prop Tax & Ins: 200$/mo.

Mortgage (if i refi w/ 60k loan @ 5%int): 330$/mo

Sewer/Water/Garbage (although tenant will likely pay): $120/mo

CASH FLOW FINANCED: 500/mo... ROE: 30%

CASH FLOW FREE & CLEAR: 830/mo... ROE: 12.5%

Please please please pick apart anything and everything I have posted about this deal above. I feel like I'm being rather fair with my estimates and it looks like the returns would justify adding a little risk regarding the tenant class. 

Honest opinions?