The higher the risk, and the lower the DESIRABILITY, the greater the cap rate.First  we need to lower the $85k “net” to probably $60k to account for property management.  

Purchase at a much lower than even market price or get aeller concessions2.

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

Costs ran significantly over on both of these items and not being in the area it was not possible for me to add my experience in renovations to lowering them. 

Invest in a relatively close, lower-cost market.

We were told the secondary market started rejecting the lower priced paper that they were originating and they were forced to raise the rates.  

@Travis Smock A cost segregation study could benefit your 6-unit property by accelerating depreciation, even on a lower-value property like yours, especially with low land value.

Generally lower than ordinary income taxes on sale depending on your tax bracket and holding period.Whether or not you are considered a Primary Residence vs.

The barrier to entry is lower so they seem attractive, and to the person who knows what they are doing, they can be very profitable.

Again PMI offers the lower rate because its less risky and offers insurance to the bank.So when you sell your current home try and keep as much as possible and avoid an "All Cash" offer.