Help evaluate this deal on 32 units PLEASE

[Serge S.]

I have a very distressed deal that fell on my lap. Got in contract but having second thoughts. Would love some expert opinions.

Property consists of 7 buildings in a 10 building complex, mix of 1,2,3, and 4 bd units, 4 5plexs and 3 4plexs for 32 units total. Each building gross rents around $2k at full occupancy. Area is suspect, not war zone but always historically low vacancy and low quality tenants. Currently 12 units occupied out of 32. Most units remodeled but the complex needs to be painted, landscaped, etc. There is a pool, playground and basketball ct.

Specifics:
$150k cash for all 32 units.
Expenses are higher than usual as they include a $300 per building HOA cost for pool and landscape maintenance.
Owner pays only water about $125 per building.
Property tax:$1300/building
Insurance $600
Vacancy needs to be assumed high
Buildings were built in 1971 so expense ratio will be above 50%.
Onsite resident manager and super on site in exchange for free rent of a 2bd and 1bd.

Although price per door is less than $5k the high expense ratio, low vacancy and sketch neighborhood have my ROI questionable and giving me very cold feet. I'd like to buy and wholesale but concerned about having to hold and manage such a headache.

Would love your thoughts, analysis and opinion.

[Joel Owens]

The point is you cannot pay for what you cannot verify and must price in the risk.

Example seller shows a building getting 3,000 a month in rents.Shows his deposits and says the tenants pay cash and to TRUST HIM.

It may or may not be true but if you can't verify on your own that it's true you must price it like it is not.

You always have to dig down and see what the sellers are hiding and the TRUE reasons for selling.

What they tell you on the phone most of the time is what they want you to believe.You have to find out the real reason and decide if you want to take on that particular problem or not.