My assumption is I'll need to invest out of this area, as cap rates around Palo Alto are very low.

is your only reasonable assurance that the credit repair folks aren't just trying to squeeze the person for as many months of monthly subscription payments as possible (which should be your default assumption about any credit repair person or people). 

Leland Smith In that case, forget everything in my post, it was a false assumption, I thought the project is in CA since you are in CA.

:( )What assumptions above are off, for better or worse?  

Am I wrong in this assumption?

What about future assumptions for repairs and maintenance?

It's a 3% tax rate on a purchase price of $125,000, the assumption that insurance is about $1000 for just the basic policy, and the annual HOA fee of $450.

Assumptions are below.  

Financing assumptions are a 30 year fixed rate mortgage with 4.25% APR and 20% down payment including rehab cost.

You are correct in the assumption that it may need a rehab and is priced way under market value.