Buying multi-family with possible ADU
Hi! Will this be a wise investment?
Purchase price: $1,100,000
15% down payment, 7% interest rate
Duplex: Two 3bed/1bath + den with unpermitted bath/kitchenette in two car garage.
Market rent: $2895 for each. I’m planning to update and repaint, maybe increase rent on one side to 3000-3100 while I live in another unit and replenish to legalize garage space.
Monthly payment: $7033.
landlord pays for water, everything else is separate.
It just feels very tight in the beginning before getting ADU gets legalized.
I wanted this property due to location but unsure if it’s worth to risk due to high monthly payment.
Appreciate your insight.