Thoroughly read the condo association rules and regs... don't overlook the condo fees and expect that they'll rise every year... see if there are provisions for a cap each year... check what the historical increases have been year over year.

For a 10% CAP Rate the sales price must be $1,28 million, with $1,7 million its only 7.5% CAP.Other with the assumable mortgage of $1,175 million at 6%, now you have a CAP Rate of 10.9%, a adequate downpayment of $225k from the buyer and you have a max price of $1,4 million, not higher and depending on the condition in- and outside.Thats my statement with the know informations.Please forget these 95% occupancy for the next 3 month it´s only a promotional tactical, even given for 3 years it´s not $300k worth.

Anyways the corporate housing project is going at a cap rate of 11%.

There must be plenty of places to invest in multifamily property with a purchase price of $4million and if you put a million down and finance the $3million at 6% with a CAP rate of 10% you would get a cashflow of $220,000 or 22% on your money. 

I would not say I have a team to do the work, but definitely have a capable recommendation completed a 300 sq/ft add on.

Dave,First, you do not "select" a cap rate.

I want a cap rate of 8% if I am buying with cash. 

In my scenario, at 4.625% interest on my 30yr mortgage, you'd look for a cap rate of 7.625%.

Using your high numbers for rent with the basement addition I get a cap rate of 4.9% with a 50% expense rate and a 5.9% rate with a 40% expense rate. 

A  cap rate on a property out of line with the market is usually a red flag.Finally, trust your seller's broker, but verify everything.