That being said I actually ran your numbers through a proforma I use and here is the break down for that: Purchase price: 129,900Effective Gross Income: 22,086 (vacancy 10% of gross income; 2454)Expenses:Expenses%EGITaxes $ 4,618.00 20.9%Insurance $ 1,500.00 Heat $ - Electricity $ - Water / Sewer $ 1,200.00 Trash / Recycling $ 180.00 Lawn / Snow $ - Management $ 2,208.60 10%Repairs $ 1,104.30 5%Capital Expenditures $ 1,104.30 5%Supplies $ - Accounting / Legal $ - Miscellaneous $ - Total Expenses $ 11,915.20 54%NOI: 10,170.80Financing: Down Payment $ 32,475.00 25%Bank Loan Amount $ 97,425.00 75%Interest Rate5.50%Closing Cost $ 7,794.00 6%Loan Term (years)30Monthly Payment w/ ESCROWDebt Service / yr $ (6,638.02)Debt Service / mo $ (553.17) $ (1,063.00)As is your property you're looking to purchase is valued at 7.8% cap rate and will produce cash flow of $3500/ year.

Buyers place values on income streams based on all kinds of stuff (alternatives, interest rates, money supply, economic conditions, confidence, risk, location, supply, asset type, upside potential, demographics).

I learned a lot regarding HVAC systems from the feedback supplied by you all and my own research.

If I supply them with a window valance, you couldn't really see the crack.

If you're comparing the Northeast to other areas of the country, you'd be insane to stay here in the Northeast if you had the ability to invest elsewhere.I've found that in terms of indicators/metrics, you can quickly go down a rabbit hole because there are a ton of different indicators, from general economic to real estate specific.So I've tried to take a step back and say, in the end it does come down to supply and demand.

My best car is a 2010 Honda Insight, it does better on a month to month basis than my 2016 Lexus IS200t f sport (which I really just wanted but justified by throwing it on Turo).  

As you know, inflation is a combination of money supply and velocity. 

You should be focusing that energy on getting your new listing up, making sure supplies are ready and really trying to figure out how your rental model is going to be better than the previous owners.

I'd recommend finding a local investor or real estate agent with knowledge of the student housing market to learn where Waterloo is on the supply-demand curve and in which direction it is presently headed.

Due to mortgage interest, depreciation, repairs, supplies, maint fee, etc.