Hey everyone so I'm a first time investor looking into multifamily properties in Charlotte, NC. Basically I'm looking at a fourplex for 125K. It says it has upgraded plumbing, water heaters, and electrical. My concern is that each unit is only 1 bed/1 bath and the property has no laundry. Is that a deal breaker?
Not necessarily. What does the market say in Charlotte for 1br/1ba apartments? It is not uncommon in some places for apartments to have no on-site laundry facilities; otherwise there would be no need for laundromats.
The main thing that can determine if it's a deal breaker is the finances. If it has very strong cash flow, and you are OK with the tenant attraction that kind of place brings, it sounds like it might be worthwhile. Are the units rented? Long term tenants? Utility costs? Taxes? Are you financing? Interest rates? There are a lot of things you need to consider more so than on-site washers.
There's one long term tenant at the moment and the other three units are vacant. Tax value is 121K. I'm financing with interest rate at 3.8. Only utility I'd be responsible for is water
I have a 1 bed 1 bath fourplex. It does have laundry but that just breaks even with the utility bill for the laundry room. Rent for 450 each. 76k in debt service, and cash flowing around 750 per month. It can definitely make for a good investment.
How much are they asking for this 4 plex? How much is the rent for each unit? How much is the one long term tenant paying? How much renovation is needed and what is the estimated cost of that renovation? Why are the 3 units empty? Is there room in the apartments for a washer dryer?
Charlotte is a great market for 1BRs because of the high amount of single professionals moving to the city. You could always just add a shed and run the utilities to it. Its not that hard. You need laundry if you want to attract worthwhile rents and qualified tenants to justify a 125k purchase price. Otherwise, speculation aside, there are better deals. Are you working with a realtor on this one, and in general?
After you figure out the current finances and if it is doable, also look at where the property may/can go long term. I have a 4-plex all 1-bedrooms and never have any trouble renting the units. Location is key. It is located near the hospital/downtown area so I attract graduate Med and Law Students and they pay their rent. This is in Jackson, MS and not a metropolis. There are other units similar to mine, which even may be more updated in the area and the property still gets consistent tenants and attraction. My 1-bedroom units are large compared to the market (800SF), and when I first viewed the property I liked that aspect. Over time, I added W/D to all the units(modified the closets) and made cosmetic changes as tenants moved out. My rents have been raised over time over $300 more/month. So the cashflow in the beginning is not nearly what it is today, with the changes made overtime. Good Luck!
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