Can anyone recommend a neighborhood where the cap rates are likely to be favorable that is also some place where I would like to live?

If you have a current appraisal you can use information in there to estimate your future value (cap rate and/or GIM). 

I am confused as to ROI and cap rates.

If somebody thinks a PM is willing to deal with that garbage for them for $40 per unit they are going to get hit with a tough reality check.Most PM's have a cap on how low they will go for % rent wise.

Do all deals you make cash flow after you knock another 10 percent off of all the other deductions such as vacancy, cap ex, etc?

I would hate to buy that property and have a cap ex come out in 4 years that wasn't accounted for. 

These are self managed properties and assume 6% vacancy, 10% of gross rents in maintenance costs, taxes, insurance, CAP EX and all that good stuff.

Lots of room to add value.Building needs about $15,000 in repairs(safety margin included) but I am using $20,000 because the siding may need to be replaced before the Cap Ex Fund(using 10%) would accumulate enough to cover it.It had snow on the roof, but I could see moss on it from the little bit I could see.

  I understand that once a property is listed, the competition grows, and the pool of people with awareness of the offering increases... but this one just went live, fits all his criteria: the price, the CAP rate, the potential upside, the cash on cash, it all fits.

Cap rate goes from 10% (purchase estimate)  to 13% (proforma)First things first, I will bring rents up to market (maybe turn over some undesirable tenants).