looking at a Duplex in Fort Lauderdale, Florida one side total square footage is 1355 one side is a 2/1 and the other is a 1/1. it is located in an opportunity zone and it sits on a double lot(13495 sq ft). zoned for 6+ townhomes on it(will verify with city). property is listed for $329,000 but when doing my comps Price per sq ft seems to be at $243. other properties are selling and closing right around $155 pr sq on average. Similar properties in the area with same square footage and similar styles have sold in the range of $255-$275. anybody have thoughts on whether I should take into accountability the double lot and potential for development? does the sq ft price matter that much when putting together a bid?
Rental Property Investor · Orlando, FL · Member since 2014 · 540 posts · 230 votes
6y
I am also planning on purchasing a duplex this year; I would not take into account the double lot or potential for development. I would just focus on if the numbers make sense and that I will cash flow.
Investor · North Hanover, NJ · Member since 2015 · 75 posts · 34 votes
6y
What are you trying to do with the property? We all know there are 4 ways to make money on your real estate…appreciation, depreciation, amortization and cash flow. Everyone knows cash flow, and I would normally not recommend purchasing a property if it does not currently cf. But you said it’s a duplex. Are you planning to live on one side? If so the rental from the other side contributes to your mortgage, thus paying down your loan. Are you looking to create appreciation by subdividing? You said you are going to check with the city…make sure you do, confirming zoning and minimum lot size and setbacks. Don’t take the listing realtors word for it. Would you be the developer or would you be selling it to someone else for development. If selling to someone else, what do those type of parcels sell for? All things being equal (and they never really are) the price per sf is an indicator. But you also need to make sure the sf being considered in the comparison is consistent.
Kevin, thank you for your response. It’s really opened my eyes as to what path to take. For this situation due to the up front capital living in one side and renting the other is ideal for the time being until we can hack another deal. The though process is to hold for while the neighborhood appreciates and oof zoning checks out find a developer willing to invest. Might be to much to digest at this moment in time, but as I grow my real estate investment portfolio I can reach out to my development contacts and review best options. Thank you once again for sharing