7-Unit SFH Portfolio Deal Analysis

[Pete K.]

Good Morning!

I need some help analyzing a deal for a 7-unit SFH portfolio in GA. We are currently negotiating on price with the seller and I just need some smarter people to help make sure I am on track for success (hopefully!). The properties are all SFH ranging from 1100-1400 sq ft, all 3 bedrooms, and some have 1 bath some have 1.5. All are currently rented. Here are my numbers:

Current Offer	$247,000.00
25% Down	$61,750.00
Closing Costs	$8,000.00
Gross Operating Income	$4,495.00
Taxes	$309.03
Insurance	$560.00
10% Management	$449.50
10% CAPEX	$449.50
5% Vacancy	$224.75
NOI	$2,502.22
Debt Service	$1,222.57
Cashflow	$1,279.65
Per Property	$182.81
Cap Rate	12.2%
Cash on Cash Return	21%

The seller's last counteroffer was for $265,000. So that changes the numbers a little bit. I am aiming for 12% CAP Rate on this one. Rents are right around where they need to be for the market. I may be able to raise them just slightly. Area appreciates about 1-2% per year. '

I'm interested in what you all think. Please let me know if you see errors or if I am missing things.

Thanks!