I also think your insurance figure is low, I don't see how proper coverage for property and liability on a 10 unit would be only $100/month.Using the 50% rule on a property with $5000 in gross monthly rents you would end up with $2500 after expenses.

at $308Vacancy (NYC) is 3% of gross monthly rents at $132Maintenance is 3% gross monthly rents at $132PITI comes to: $3397Monthly Expenses added up equal $572Total monthly expenses come to $3969.If i take the monthly gross rents at $4400 - $3969 total monthly expenses, I am getting $431 in monthly cash flow.Ill be honest, I am little concerned that I am leaving something out or not calculating something correctly.

Though it's generally based on gross income, I would still be leery of this.

That calculation you're showing for cap rate is a cash on cash return.The cap rate is the gross income divided by the purchase price, or in this case 11.47%.

I am not seeing it too much now, but up until last year I could expect gross rents of $1,200 a month for every $100k in purchase price.

Owner agrees to compensate Manager as follows: Owner agrees to pay the Manager ___12 (twelve)_ percent of all gross receipts and income collected, as a fee for managing the Property (gross receipts are defined as all revenues of any type or nature collected from the operation of the Property), including but not limited to refundable deposits; which fees, plus all other expenses of any kind or nature, direct or indirect, as to the Property and management thereof, shall be deducted by the Manager from gross receipts and income, and further agrees to abide by the conditions set forth by the Manager to the tenant on the Owner’s behalf. $50 monthly fee on months of vacancy.

Deal:24 occupied spacesAsking: $365,000Seller accepted $275,000 - $50,000 down, $2995 per month- CAP rate actual: 12.1%- CAP rate: 19.4% (12 months pro forma at $100 increase in space rent, $265/spc, 30% expense)- Terms: $225,000 Seller carry note 12 yr $2995 per month, 7 year 18% pre-pay penalty- Space rent: $165- Market rent: $280- Gross rent/month: $3960- All tenant owned homes- Road: park, gravel- Water: city- Trash: city- Sewer: city Market Research:- Schools: A (great high schools and private schools)- Population: 5000- Metro area population (1 hr) from 6MM metro- Test craigslist ad pulls 20-30 calls per week.

Most of us here on BP assume that we will only put 50% of the gross rent into our pockets.

Here's the simple formula for illustrative purposes: Gross rents - expenses = Net Operating Income X cap rate = estimated value If you know what the gross rents are, you can use the 50% rule to estimate the expenses.

. $100 each raising the gross total rents to $2,500.Any input would be appreciated!