Too many headaches for cash flow on paper (which is actually negative in reality) : stolen AC unit (thieves climbed a 7 ft fence), attempted break in (alarm scared intruder away), repair issues, winter weather (make sure someone turns up the heat on a vacant property).

leases.The only work I think it immediately needs is fixing the back steps and a few roof repairs.

Compare how you would expect this home to perform as a rental with reasonable assumptions about cap ex, vacancy, repair etc and then figure out what kind of rental or possibly RENTALS (multiple) you could purchase if you sold this property and how would they perform.

DSCR just has higher rates and if you overestimate the rents and underestimate the repairs or maintenance, the deal goes south quickly.

Then you spot “Vinnie’s Beer, Pizza and VCR repair” is paying a 50% interest rate on the money it borrows.  

With negative cash flow you have to continuously pay out of pocket for repairs or upgrades.

They are financial nightmares and very challenging to repair and replace the roof underneath.

Keep the units but turn over to a management company 8% off the top plus roughly double my normal repair budget. 

Sell, pocket $200k in equity, appreciation since they bought it, bank 25% for a new deposit in a year once they repair credit, buy two new second hand cars because they need them, pay off credit card debt, put a little extra to the side for increased rent payments for next 12 months, and reorganize to buy in 12-18 months... now they see the light, a chance to move forward, to not stress, and they're lucky the market increased so much... but if they struggle to keep it, struggle to make payments, then 10 months realize they need to sell, would they have as much equity, maybe, maybe not..  

Additionally, repair costs (if any),  all closing costs are covered by the buyer, and there is no commission!