We'd know about the true history of the property and capital expenditures before purchasing-- misrepresentation wouldn't be a concern.) 

You can take on partners, such as private lenders, equity partners, etc.Other expenditures are just that: expenses with zero return other than continuing on-going operations.Just wanted to put that out there.

Flip option:If I sell for $150,000-$9,000 (6% commission)-$4,500 (estimated 3% closing costs)-$5,000 repairs$131,500                                   Holding costs                                       5% interest on $126,000 = $6,300 /yr = $525/mo                                       Property Tax 2100/12=$175/mo                                       HOA 360/12=$30/mo                                        Insurance $1,000 estimated/12 = $83/mo                                         Utilities $200/mo                                         Total $1013/mo-$4052 (4 months of holding costs)$127,448 Net sales proceedsIf paid what is owed on Mortgage ($126,000) then not really any profit for me, and no margin of safety.On the above numbers I don’t see positive cash flow on a buy and hold strategy after considering insurance, property management, vacancy, capital expenditures and repairs.

Multi family homes require exponentially more capital expenditures than single family homes. 

@Tom CooperFor larger capital expenditures, you try to forecast when they need to be done.  

In addition, repairs and capital expenditures will be subject to the final tangible property regulations which I briefly mentioned above.You will also depreciate the rented part of your property, which is why accurately reporting basis is critical.

We put a new HVAC unit in last year, and the roof was put on in 2014, so I should not have to worry about the larger expenditures for some time.  

You also need to build in capital expenditures, e.g., for a new roof, furnace, hw heater, etc.

Looking for similar feedback on this topic as well as we are looking at ways to reduce water expenditure on our multiunit complex.

Now if your cash flow numbers are figured using piti as the only expense the profits are probably pretty slim.Spending a lot on the rehab just reduces your unexpected capital expenditures as time goes on.