In a B area I would certainly estimate more for on-going maintenance, and reality is since it's more on the equity scale of investing your cap rates are appropriate.

, then you've got a much firmer leg to stand on going forward when rent time comes around.  

The seller generally in that case did not properly maintain the asset so they could try to suck out extra cash flow and then when they sell they try to get some crazy price for the property.As far as reserves there is immediate capex and ongoing capex.

I wanted to learn more about what they had to offer so I had a "strategy call" with one of their people and they laid out their 90 day plan to profits and then ended the call with the price.I have found different prices noted for their program from the past but their newest price offered to me was $15k entry (ouch) but with a $6k discount for making a decision within 24 hours hence $9k entry and then ongoing $197 systems fee after the initial 90 days of training.  

The biggest ongoing operating expense is the property tax.  

Many property management companies charge 8-10% (5-7% if you have enough unit density) for the on-going management.  

Only SOLD prices count, which according to your intention to develop to rent, means that the sold prices of older buildings and their rental returns are still very relevant to your situation, because renters can't be counted on to pay a lot more per month just because a building is new - because they don't have to pay for the ongoing repairs to older buildings anyway.

I will never understand why people look past ongoing rental income, appreciation, tax benefits and the pride of ownership for one-time little paydays.  

If you have a knack for being a landlord, this one seems to have pretty good cash flow for you.Renting it will always require a budget for ongoing repairs and maintenance.  

Also, $1300 might include PITI but it does not include ongoing repairs, capex, vacancy (he won't be there forever), and property management.