8-Plex Analysis - Enterprise, Alabama

[Don Petrash]

Hello, BP! 

This 8-plex in Alabama looks like a great deal to me, and I'm interested in feedback from the gurus out there on the details.  Link posted below.

Each unit is 2 bed / 1 bath, renting for $450/mo.  The owner has not raised the rents in a long time - I could probably increase rents by $50 with no work, and $100-$150 more after some updating and repairs.  My agent did a walkthrough last week, and the units we saw were in good shape.  Looks like a single metal roof for the whole property.  2-4 of the A/C units are new; at least 4 are decades old.  The property was built in the 70s.  

The seller is asking $310k.  I'm planning to offer $300k.  Anticipating value add after 5 years to $400k.  (Valuing the property is where I could use some sage advice.  I'm not sure of the area cap rate). 

All tenants are on month-to-month lease extensions.  All units are occupied, and all tenants are currently paying (even during COVID). 

https://www.biggerpockets.com/...

Let me know if the link doesn't work, and thanks for your time! 

-Don