Analyses of a property in NJ - can you find what I missed?

[Oleg Shalumov]

Hello, please let me know if I am missing something in my analyses.

It is a 4 Family property with the following expenses:

• Asking Price $500K
• Down payment %25 $125K
• Closing Cost $25K
• Repair $0 (property is in good condition)
• Property Tax $12K
• Insurance $4,400 (Building+Liability+Flood). Only 2 cases of Flood (Irene and Sandy)
• Management $5700 (10%) - even that it will be self-managed, I am putting this as expense
• Water $1200
• Vacancy Rate $2880 (5%) - is that enough?
• Maintenance  $3,000 - is that enough?
• Do I need CapEx? How much do I need to put monthly/yearly?
• I was told that those are the only expenses. Am I missing anything else?
• Mortgage on $375K based on 4% for 30 years is $1,790
• Total Yearly Expense is $29,410 and Monthly expense + Mortgage is $4,241

The property is giving income of $5200 a month from all 4 apartments, with monthly Cash flow of under $1,000 a month.

Even that Cash flow look very good, the Cap Rate is only 6.28% and COC of 7.67%.

Also owner is offering to "hold mortgage for balance" - what does that means?

What do you think?

Thanks in advance for you responds.