Since there is so little that needs to be supplied, I would be very happy to cap off the circuits to the basement and hallway and the front porch light, and simply put in motion detector battery operated lighting in these areas, and tell the tenant to use the hookups in her kitchen, and get out of the basement.  

I just have no interest into buying into a 5-6 cap property.  

My own background is in high-tech, and although I don't agree with a lot of the brainwashing they make you endure during 4 years of university (and afterwards in industry), I will have to say that becoming an engineer/software developer is one of the best majors you can graduate with because you get a lot of "bang for your buck".

When running numbers to figure cap rate do you include percentages for vacancy and repairs into your NOI?

Purchase Price 180, 4 family built in early 1900'sRoof, heating, electric all updated in last 5 years, replacement windows and vinyl sidingOff street parking, dead end street c+ b- area30/yr mtg 4.65% about 6k in closing costsAnnual income including coin op roughly 39kUsing 10% for repairs/mait, 5% cap ex, 8% gross rents for prop management, taxes, accounting, lawn/snow, trash, utilities etc....noi is about 14kCFBT is about 6200kI like to get about 200 per unit per month on a 4 fam which i would be able to if not for prop mgmt fee so I'm thinking this is a decent dealThoughts?

Should the cap rate be a part of my analysis and if so, how is the best way to think about it in my market in metro-St.

Once you get good at this, you can probably bang out 20 calcs in the time it would take you to go drive and check out one property.

When it comes in contact with your ballcap, take hold of the cap and turn it around on your head, so that the brim of the cap is facing FORWARD.Good luck!

So at your offer price, that would be a cap rate around 7.5-8%.With an interest rate of 6.5% on the loan, I don't see much of a safety margin.  

Interestingly enough, Zillow says the property went into foreclosure nov 25th and the lender took it, which means it's pretty much bang on 6 months.It's in Michigan if that helps.