Updated over 3 years ago on . Most recent reply
Check my homework on this?
3000sqft SF Bay Area (Marin County) duplex for sale.
Unit 1: 2br/1ba
Unit 2: 4br/3ba
ADU: 1br/1ba, kitchenette
Is this insane? In order to make this cash flow, I will live in the ADU and:
STR Unit 1 (comps are 60-80k/yr)
STR Unit 2 as both "entire house" and 4 separate "private rooms" with shared kitchen.
Entire house comps: 87k/yr
Private room comps: 40k/yr/room
STR comps for all units is roughly $15000, which will cash flow $5k/mo
LTR comps for all units is ~$12900, which will cash flow $3k/mo
Most Popular Reply
A few questions/comments:
How did you calculate $12,900 gross revenue as a LTR on this property? This seems high to me.
The exemption in the ADU law for renting non-owner-occupied properties expires in 3 years or thereabouts. You should figure on losing rental income from the ADU in year 3 or 4.
How did you calculate market value at $1.5 and purchase price at $1.3? If the property needs work and thus can be purchased at a discount to market value then you need to account for the cost of this work in your calculations.
Your property tax should be closer to $1,400/month on purchase price of $1.3M per my calculation. How did you calculate $1,900/mo.
Is the owner responsible for all utilities (PG&E & water)? You should check past bills. Depending on the property $1,000/month could be substantially off.
Why a 3% annual increase in property taxes? Where di you get that?