Apartment Complex Deal

[Robert Burns]

I just came across a potentially good deal? on a 12 unit apartment complex in my city. The apartments are (8) 2/1 and (4) 1/1 renting @ $575/mo and $525/mo respectively. $6,600/mo and $79,200 gross rental income. The complex is in a reasonably good area of town right across the street from a public school. They are fully rented and it's my understanding the vacancy rate is very low. The property also appears to be in great shape, new roof and no rehab. The price is $379K. I have not purchased apts before so I need some advice on what to offer. I have a buyer who is interested in properties like this, so I intend to make and offer and sell him the assignment when to offer is accepted with an inspection clause. I am talking to my realtor to get the expenses so I can calculate my NOI.

Any comments/suggestions will be appreciated.

[Jon Holdman]

You're right in the range where the 2% rule works just fine. So, with gross incomes of $6600 a month, this thing is worth about $330K. $379K is too high, IMHO, but if you're buyer is interested and you can get it at a price that makes you some money and makes your buyer happy it sounds like a good deal to me.