Either or works Well just use this as a simple example 24 Unit apartment Complex ( B-  or C +  type  property Purchase Price - 1,920,000 ( $80k Per Unit ) may be low in this market Down payment - 25% = $480,000 Rehab - $ 6,500 per Unit ( some units  more than others ) = $ 156,000Common Rehab - Water Heater , laundry room if it has one , Paint of building , landscaping , windows , parking lot  , roof ( 10k - 70k ) This ranges a lot depending on the property Closing cost - 20-30k tax - 7,000 / year insurance - 12,000 ( wind n hail , general , fire  ) / per year Property Management ( 10 % ) = 2,160 / per month vacancy - 10 % = $ 2,160 per month Cap X ( fridge , window , curtains , doors , paint , roof , pavement ) - 1,080 / per month Landscaping - $ 800 per month simple repairs - $ 500 -900 per month common area electric - $ 300 per month Mortgage $ 7,500 ( 30 year amortization  , 4.75 % rate  ) Income - $900 per unit = $21,600 , this varies based on area . 

Vacancy/collection loss should be estimated based on market information.

Nearly $10k later for plumbing, plus more $ for access to plumbing, after all the plumbing was replaced in a 100 year old house (e.g. no access, lots of additions) all is well:)  But lesson learned, ask for dates of vacancy and date of Winterization, or look for the stickers in the house and ask the neighbors when the folks left.

@Jordan Jones I get 12-15% on my buy and hold purchases with 20% down (that is after setting aside 8% for vacancy, and 10-15% for capex and maintenance). 

@Brent WoosterAsk for a vacancy policy.

Have you seen any fluctuation of the vacancy in different seasons? 

You are taking CAPEX and adding maintenance and vacancy into 10% - that seems like an overly hopeful campaign. 

Have enough money to cover repairs and vacancies for all the units if for some absurd reason the are all vacant at the same time.

@Rosario RolandiProvided your numbers are correct (1500 rent and 980 PITI) I say keep. 980 + 5% for each of the 3 “big reserves” (vacancy, CAPEX, maintenance), leaves you at $1205.

That minimizes your vacancy.