How to determine value of duplex?

5 Replies

Hey ya’ll. My wife and I currently live in a duplex, with another one behind us on the same lot (4 units in total). We are currently paying $550/month in rent, and were considering house hacking with the idea of buying and then renting out the other units. This have been difficult for me because I have not yet done a transaction, I’ve sold some homes as a Realtor, but I feel like with how appreciated our market is, the price I would pay for the 4 units would be higher than the rent (unless new paint, carpet, and appliances were added - then I could increase the rent)...my biggest area of difficulty though is the MATH. I’m good at it, I just don’t know where to get the numbers from? How do I price a 2 BR 1 BA duplex? Because to my understanding, anything less than 5 units isn’t considered a multi-family, still a single-family. So I’m pretty lost, have great ambition to purchase this property...I just need hard numbers and I do not know what that looks like. Any and all insight is appreciated. Thank you.

@Kevin Krysty Jr. Have you tried searching for similar properties that have sold in your area on Zillow? You can typically find duplexes/triplexes by setting your search criteria to "recently sold" and "Apartments" on Zillow as that's where small multifamilies show up on that site. If you know of neighborhoods with similar duplexes you could also try looking the addresses up on your county tax assessor website to see what they last sold for. At the end of the day though, what you should pay and what people are paying are two different things, so while I'd try and get a feel for what duplexes have sold for in your area, I'd also calculate what the most you can pay and still make decent cashflow and use that number to guide any offers you make.

@Zac Lester my landlord is older and sold all of his rentals last year, besides mine. With this knowledge, and my new interest in REI, I approached him and asked if he’d be willing to sell - he told me it would have to be all 4 units, and to come back with an offer. That was like a week ago.