Multifamily Tax Assessment v/s sale price

[Jackson Sandland]

I"m looking to buy my second investment property. I've got an off-market duplex in a great Milwaukee neighborhood. Houses on either side of the duplex are selling fast for $140k cash, and up. There are two tenants already renting for a total of ~$1500 / month. Some back of the napkin calculations, including all expenses, shows a possible $600 / month profit. Not too shabby. The property is priced around $100k. Here's the rub:
 I checked the property value assessment for 2017, and it's assessed at $50k. 

When investing in multi-families, do you pay attention to the tax assessed value?

Knowing I'd be paying almost twice the tax assessed value is giving me pause b/c there's no built in equity at the time of sale. Appreciation for the neighborhood is very strong as well. It's been going up 20% / year as of late. What do my fellow real estate investors think of this deal?

Thanks!

Jackson

[Mike Lowery]

Comps in the neighborhood are going for $140K. That is more of a driver for me than a tax assessment. When was the last time it was assessed? Perhaps the property was updated and hasn’t since been assessed. The $140K figure is what I’d be more interested in, however, if your assessment goes up to purchase price ($100K) you’re looking at doubling your tax bill, which will affect cash flow.
So $100K duplex in a neighborhood where others are selling for $140K is great, but what is your cash flow going to be if your property tax doubles.