Advice on first multi-family purchase - 5-plex
Hey there
Been on the site awhile and pretty well seasoned with single family homes (10 doors and counting), but multi family is a bit unfamiliar.
I have found an off market 5-plex in a smaller community that has low vacancy (as does the whole region I live in here in British Columbia).
The pro’s:
-5 units generating $2800/mo gross rents (which could be bumped up to $3200-3600 with some Reno’s).
-electrical, plumbing updated, re-insulated
-Central location
The cons:
-low income/disability tenants (however have been there for years and seems rent is steady)
-the house was built in the early 1900’s
With a purchase price of $330k - the cash on cash returns look great, I do think it’s undervalued if going off cap rate as most multi is in the 5-6 cap range.
The hard part for me is getting my head wrapped around that old of a building and the tenant profile - usually I focus on Reno’s and attracting high quality tenants....with everyone on here I’m sure some of you can shed some light on your experiences and any advice?