How to analyze this 24 unit complex

[Ernad D.]

Dear BP,

I have been getting creative looking for properties and reached out to an owner with a 24 unit complex that is not on the market. The reason I am interested is because the owner would "consider seller financing, depending on the terms".  The property is in a very good neighborhood and five minutes away from my home, so I could self-manage.  There is a property manager who gets free rent and takes care of the yard, but I would not need the property manager.  The building was built in 1968 and is low maintenance with all new appliances and remodeled units. Owner goes there once a month to do major jobs that need repairs.  I did some rent research and the $600/mo is very reasonable for these 2 bed town homes.  Only garbage, yard, and snow plowing are included - tenants pay for everything else.  Owner states the needs $900,000 for the mortgage balance to be transferred.

Data provided by the owner:

• income - currently 13005 a month (14400 at full capacity at $600/mo each)
• mortgage - 8096 a month including taxes and Insurance
• electric - 60 a month
• garbage - 140 a month
• income 4709 a month

This would be huge step from my current four family property, but I am interested.  What is the best way to analyze/ determine if this property is a great investment?  What challenges do I need to consider?   What next questions do I need to ask the owner?  

Bonus:  a picture of the complex (there are 3 buildings with 8 units each):

[Mike Sedlacek]

I would view a profit and loss statement for the past 5 years from his CPA or a copy of his IRS statement. When I buy an income property each unit has to put in my pocket first $100 per month minimum before I would consider the deal. Then subtract your expenses from the remainder income. Is there money left and is there enough for un-for-seens as I put it. I usually figure in 5 % for that per year. Basically what would it cost you personally to own that property?