If you purchase a "c" building in a "b" location and wish to increase income through upgrades, you can do it all in one location dealing with only one transaction. 

Depending on where you are looking to invest, that may be a completely unrealistic expectation, or elsewhere, a useful way of quickly gauging whether an asking price is in the right ball park.So the "metric" of whether it should be 1%, 2%, or higher, or lower, for any particular area is largely to do with the other factors that indicate whether a property would be a wise investment:- Is the neighborhood A, B, C, or D?

The property is in a B area so I should be able to get decent tenants, and want to make sure I screen properly. 

I was a B-ish student in high school.

I'm in the process of closing on a 5 unit (4 unit 2 bdrm 1 unit 1 bdrm)price is 199Ktotal income 33300 less 5% vac ~31635total exp 14802Taxes are 6890Insurance 1250Electric 600Water 800Mgt 1581Maint 1581Reserve 1250Snow 400Lawn 450Annual payment to mortgage is 10.8KI wanted to get others take on the numbers, i'm doing my due dillegence and background it is in an ok area middle to lower income right outside of buffalo, virtually no crime but incomes are a little lower in this area so i would class it in a B almost C neighborhood.

From my short time at biggerpockets I can say that there are some experienced and savvy business people and investors around who require you to illustrate your plan from a - b and have a backup plan from b - c before they would consider someone as a partner.

While at the same time saying it is ethical and legal for a realtor to use their expert knowledge, privileged access to information, and trusted status to buy a house for ANY price they can talk a seller into, with the simple disclosure: "I am a licensed agent but am not acting in that capacity in this transaction."100% Grade A, BS.

You've got your exits A, B, and possibly C into place. 4.

Asking Price: 245,000Turn key fully rented quadplex built in 2000, no required improvements in a B neighborhoodTotal Rent: 2950 which is already the mid-high end for the area so I doubt there is a potential value play.Property Tax: 2200Insurance: 1100Utilities (water): 1680Maintenance+Property Management + Vacancies estimated at 30% of rentThis comes out to 44% of rent = planned expenses which is pretty close to 50% rule, so passes sanity check.Monthly Rent - Expenses: 1,650Cap Rate: 8.02%25% down with 3.875% mortgage for a 15% Cash on Cash returnCash flow: 786To check my math against rules of thumb:50% of rent: 1475, payment on a 0% down mortgage: 1161Cashflow: 314, or about $80 per doorUsing my calculated expenses net rent: 1650payment on a 0% down mortgage: 1161Cashflow: 489, or about $120 per doorI plan to initially offer $220k which would price the cap rate to 9% and cashflow up to 875, but I think the property is a reasonable deal even at asking and currently am prepared to pay retail price.

$1mm in 1-2 properties, I'd likely go with class B apartments, or maybe class C in a B area.