@Mitch Messer, I appreciate the feedback and the thought provoking you've inspired in me! However, I'm looking at the deal a little differently, but please let me know if you agree. I agree with your numbers, but what if we take your operating expenses of $12,720 and add to it a monthly mortgage pmt back to the seller of $928.53 ($235k@2.5;30yrs;$5k down) for a total of $23,860 per year operating expenses. Gross income of $25,200 - $23,860 expenses = $1,340 NOI
$1,340 (I agree-not much) NOI on $5k down = 26.8% COC That's pretty not awful, and those are as-is numbers.
Current rents are at least $300 below market on both sides, so if I only bump rents $100 each side brings in another $2,400 of income, which translates to nearly 75% COC as soon as I take over. If I bump rents on both sided $100/year for 3 years, my year 3 income goes from $1,340 to $8,540, or 170% COC per year.
Please...someone show me what I'm missing! Or if anyone has ideas on how to execute.