Buying My First Fourplex

[Chris Woods]

I have been lurking for quite sometime but decided to make my first post now that I am in escrow with my first property. I live in Fresno,CA and am purchasing a REO fourplex that currently has 3 units occupied with 1 vacant unit. I am using an FHA loan and will be living in one of the units. I will also be using a property management company. I am purchasing the property for 200k and the current rents are $650 per unit and the tenants are Section 8 but all older/disabled people that have been there for 6+ years. The property management company says that I can put in a request to raise the rents since they are below market average and should be around $750 to $800. I did a walk through on all the units today and there doesn't appear to be any major issues. I'm having all my inspections done this Friday so I will see what those uncover. I know from looking at the forums that this property may not fit all the "rules" but I think this property is a good fit for a owner occupied fourplex. If anyone has any tips or advice I would appreciate it. Also if anyone is investing in the Fresno area I would really like to chat. Thanks!

[Eric Tomlinson]

Welcome to BP Chris. As you are already aware, there is an incredible amount of info available from great people.

Congrats on going under contract w/ your first place. The 'rules' probably don't apply when you are an owner occupant. I think you are making a wise decision by having other people to pay for your mortgage on your place of residence.

My only tip would be to question the use of a property management co. Why do you want to give away 8-10% of gross rents when you live right there? I use a pm co b/c my nearest rental is 30mins away and don't want to deal w/ the issues that will arise being that far. If I owned the house next door, I doubt I would use a pm co. Just my .02, but think it would add ~200/month to help cover other expenses.

Again congrats and let us know how it goes and welcome!

Good Luck