This isn't a joke listing!

[Robert Freeborn]

Hi BP Fam! 

I have a mls drip feed from a great realtor in the WA state area. I got a email yesterday for a 3-plex in Bellingham Washington. I'm going to list out the details below. I will NOT include identifying details (you can pm me if you want them.). What I'd like help with is this: am I totally off base, or is this so overpriced its beyond ridiculous? Or am I just so green that I don't see the deal. Here's the info from the MLS:

Listing Remarks: INVESTOR ALERT: Excellent University Investment Property! Triplex with 1 large 6 Bedroom, 2 Bath Unit with new kitchen, Fir cabinets and Fir floors throughout. Bay views & window seats give this home old charm & character. Also 2 - 1 Bedroom, 1 Bath Units - Always Rented!!! Parking in rear for 5 cars. Shared Coin-op Laundry Room.

3512 SF.

Built 1904

Lot 6969 SF

Gross Adjusted Income: 70,860

Net Operating Income: 54,860

Water/Sewer/Garbage: 0

Total Expenses: 16000

Gross Rent Multiplier: 14%

Cap Rate 5.7%

Additional Monthly Income: 300

Unit 1: 6 beds, 2 bath. Rent: 3785

Unit 2: 1 bed, 1 bath. Rent: 900

Unit 3: 1 bed, 1 bath. Rent 920

Asking Price: $970,000

50% rule means 2802 for expenses. If we assume you finance it for 30 years at 4.2% with 250k down, your debt service is 3520. Add it the 50% rule and you're at 6322.5 in expenses per month, or -$720 cash flow a month. 

If you buy it all cash, you would cash flow, but I can't fathom why someone would pay cash for this property when they could use that to leverage a much, much larger multi that has much better cash flow.

So, back to my original question: Are the owners crazy?  Or am I crazy and just don't see the deal here?

I look forward to learning from your wisdom and insights.