Your correct that there are very few duplex or triplexes here and what is available is very overpriced. 

Yes, that's correct.

I ran the tool three times to ensure I had all the numbers correct and that's what I keep on coming up with.

Frank is correct, the other three properties you must have 25% down for traditional financing, although you could maybe seek out private financing.

Correct me if I'm wrong but to me this looks like an awesome deal especially as a first investment.

Same goes for the surveillance cameras as well.What really is problematic is that no matter how much you try to tell people NOT to FLUSH down things like diapers that will cause the sewers to back up, it ALWAYS happen... and, according to my Contractor.... there is no worse job than to clean up that mess.So.... correct some of these that lead to over-consumption, high maintenance costs, etc. and you may get a better, more affordable housing situation.I don't think it's a large percentage of the people that are the problem.

They owned the house for around 10 years, so am I correct in thinking they won't pay an capital gains tax if they sold it themselves?

And @gregscott is correct.  

Then, you need to market yourself correctly.

Based on that price point / unit count I assume you are correct in that you're looking a C range property.