Your best offer is the offer that allows you to make money, with a bit of cushion if things don't go the way you expect.There are other properties to buy if this one isn't accepted.

In fact you also need a cushion of money for inseeable expenses.

I put aside a portion of the rental income for potential fixes, PM fees, and just a cushion incase there is vacancy.

You say you are ok with only making $10k since you will be learning something ... thinking of your profit margin in absolute terms rather than thinking of it as not only a profit margin, but also a margin of safety ... it is the cushion that stands between you and a loss.

It's just an additional cushion.

Being at full occupancy can cushion a lot of expense overages.

So it may not be available.But if you take little manageable steps until you've got a safety cushion of a few months, and no consumer credit at all, and a paid for primary residence (I admit it I do bear a resemblance to another Dave..) then you can feel absolutely comfortable going all in and leveraging to your hearts content (it's only a passing resemblance to that other Dave).  

If you get it for a price that gives you more cash cushion, your pressure to raise rents is lessened. 

You'll need to be up to speed in NC on how DD and EMD work, the impact of the 14 day cushion on the 2-T, the MOG disclosure, and the list goes on...

Details:5 units - Large home that was converted to 5 units a long time ago, all separate utilitiesLocation: Philly (Not a very desirable neighborhood)Purchase price - $160k (but I may be able to get it lower)Monthly Rents - $2595, no vacancies no section 8Monthly Expenses - $2049, estimated vacancies of 10%, 6% repairs, 7.5% ($200/month) capex, 11% mgmt fees and using the actual tax and estimated insurance numbersI also estimated $4k for closing costs and $10k in repairs (no major repairs on needed, this is just a cushion because I imagine there is something)======================CoC ROI = 14.2% / $545 monthly cash flowPro Forma Cap Rate = 9.47%======================My concerns/questions:- Am I analyzing this right?