Current Tennant Paying LOW Rent, Possible Buy
I've been looking at properties near me, specifically a duplex, the property is 359,000 and i was thinking about house hacking, with one unit being rented out for 1800 (fair price for college living around me) and me living in the other one, i would essentially being paying 650 in "rent" (house payments) to live there. If i am able to move out in a couple years and rent both units out for 1800 a month,3600 total, after all expenses the CoCROI i calculated would be about 19% which is amazing.
The only issue as of right now is that one of the units is vacant (which is fine, i could live there) but the other unit is rented out for 1000/month for another year.
This is a SWEET deal if the rent payments were at the right point, which i would definitely make them if i owned the property. Perhaps this is why someone is selling this place to potentially offset the losses that they may be getting with such a low rent paying tenant.
I know i probably should not buy this property as of right now and there will be more in the future, but with the right rent rate this deal could be a WINNER, is it advisable to look a year down the road knowing you will be making more then and then just suffer for a year of lower rent payments?
Most Popular Reply
$800 below market is quite the discount they are receiving if the comparables are very similar. I would verify the $1800 and verify the status of the college (is it opening? do people need to live near it?) you are referring to since we are in COVID. I would also check the sale comparables for this property. Are you getting a discount of $10K+? Make sure to factor in the renovations required to bring that unit to $1800 worth after the tenant moves out.