My partner and I have a property in SE Portland that is in the final stages of development for a duplex.
We purchased the property with the intention of rehabbing the home on the front end of the lot and then partitioning two additional lots behind the home that will be accessed from a dead-end street and not requiring a flag lot. The City of Portland decided that they wanted three feet of our lot for a pedestrian pass-through so we had to re-evaluate and decided that we would only partition one additional lot developed for a duplex.
My question; what makes more sense . . . to sell the house separately from the lot, or should we market both lots to investors to allow them to build a duplex and keep the front home as well? Our current rental income is $1695/mo and the duplex should bring the same for each unit. The lease renewal is approaching and I understand that the property is more attractive with a signed year-long lease.
My problem with selling the house separately is finding an owner who would not be bothered by having a two-story duplex that overlooks their backyard.
Thanks for any feedback you have to offer.
Did you already do the lot partition? I'd likely market it to everyone. In Portland's hot market, you can get by with selling a house that has little or no back yard or has a negative such as a duplex overlooking it. On one hand, a buyer with vision to live in the house and rent out the duplex may want the lot at pre-plat for financing purposes then they could later complete the partition and get construction financing for the duplex. On the other hand, it's not unusual any more to see attached and unattached housing stuffed anywhere they can fit in Portland so you may find buyers for each property individually just as well. Hopefully you can fit in some trees as a buffer, but this being Portland let's hope nobody ever wants to take them down!
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