7 condo deal - 10.8% Cap - is this deal good enough??

[Harsh Garg]

7 Condo - (5 - two BD Unit and 2 - one BD Unit)

Purchase Price - $350k

Down- 30%

Loan- 245k

100% Occupied

Annual rent- $48,360

Expenses

Property Taxes:	$248.00
Water:	$120.00
Garbage:	$100.00
Property Insurance:	$80.00
Maintenance:	$100.00
Total monthly Expense	$648.00
Expense yearly		$7,776.00

\Vacancy(5%) -  $2418

Annual Mortgage Payment(12*1241) = $14892

Annual Property Management(6%) ~$ 2902

Total annual Expense($7776+2418+14892+2902) =  $27,988

Annual Net cash flow =  $48360 - $27,988 =  $20,372

Return on Cash ~19%

Thanks

Garg

[Wayne Brooks]

Not nearly enough money for maintenance, no turn over costs and no capex......this is not a 10% cap.  And about one month vacancy/collection loss per unit every two years on $600/mo. rentals seems wishful.