As my underwriting “standards” I figure:CapEx 7.5%Repairs 7.5%Vacancy 8%Management 10%Water/sewer $40/unit/month, then confirm with the town

That said, they are popular with first time buyers who are using all their cash on the downpayment and would be sunk if one of the big things (roof, HVAC, water heater) goes bad right away.

Now, this duplex was turn key and had numerous upgrades such as flooring, painting, hot water heaters, roof.

Coincidentally at the beginning of the month, I receive a water bill for over $3,000!

I had an issue last year with a vent hood being installed incorrectly on a water heater. 

If they are the ones causing the damage, you are right in that they need to pay for it. 

For water, it’s fine.

Water heater uses 25 - 30 AMPS.

This is a typical "seasoning period" required by most lenders.Repairs and CapEx will probably be closer to 15% of GSR all in.You're not accounting for insurance.What about water/sewer or shared utilities?

You get stuff like holes in the hallways, broken outside lights, damage to a common washer / dryer (if there is one), that no one will fess up to and will come out of your pocket.Don't be afraid to make low offers.