I'm looking into a 1925 duplex in an "over-and-under" configuration.

There are two units, each about 700 square feet, and the downstairs one is partially below ground (there are windows high up on the foundation).  The entrance to the downstairs unit is via concrete steps at the rear of the house.

Are there any special considerations I should make when evaluating this property?  Can I expect the lower unit to rent for less and be less desirable to tenants, or to attract a lower tenant quality?  Anything to watch out for in the inspection given the age or configuration?  

Thanks,

Mike

Lower unit will more than likely rent for less than the upper unit, all else equal, if for no other reason than the windows. All else equal is an important caveat though - so it will be based on what you do with it. I would not say that it would attract a lower quality tenant unless you're equating lower price to lower quality. Within every rental price range, there are a host of tenants - that's what the screening / meeting process is for. Your job as landlord is to find the quality tenant in that price range. If you don't - keep marketing it.

Here in CT we have more over/under units than side by side - and even if all units are above ground you will still find that some tenants come in and are willing to pay more to be on the top floor ("I like that there's no one above me") and some will pay more for ground floor ("I hate carrying groceries up stairs"). Its all a matter of finding the right tenant. I'm a big proponent of putting extra insulation in between units for 'sound-proofing'. I wouldn't go so far as all of those special sound proofing underlayments and overlayments, just extra insulation and it will keep the noise to a minimum.

Given the age of the building - electrical is my big recommendation. God forbid the wiring has not been upgraded since construction. We just flipped a house from 1940 and the wiring was all original - spent close to 20k rewiring everything. If it was upgraded anytime in the last 30-40 years, it will at least be shielded wiring, but from 1925 - check!

Same things as any other - no special "look out because its over/under". Check the plumbing - I prefer to always run new hot/cold risers and laterals before you start renting, as it will never be an easier time and you can sleep well at night knowing there will be no calls from tenants about a water leak!

And as with all multi families - how are utilities split? If they're not currently split, its a good time to look into dividing them now before you start renting.

Good luck!

@Mike Catalfamo

Adding to the comments from @Travis Lloyd , in addition to electrical, you should give the plumbing a thorough review. Unless already updated, your waste lines will most probably be a mixture of cast iron and galvanized, but clay is still a possibility, and will be at their end-of-life.  On the supply side, copper is most probable, but galvanized and, even, lead are possibilities.

It is also very probable the duplex does not meet modern fire codes.  Here, if you were to undertake a significant renovation (e.g. rewiring, re-plumbing), you would be required to properly fire-separate the units.   A 1925 build might still be balloon framed, in which case, you may be required (here you would anyway) to fire rate (resilient channel, 5/8" fire-X drywall, non combustible insulation such as rock wool between floors and separating walls) external and load bearing walls in addition to ceilings and dividing walls. 

Thank you both for the inputs.

This is the property I am considering:  http://www.zillow.com/homedetails/203-S-Diamond-St...

@Roy N. - I'm glad you brought up the concern about modern fire code.  One concern I have is whether the basement unit meets the current code with respect to egress windows in the bedrooms.  

From what I can tell, the sliding windows in the pictures on the listing (included below) don't appear to meet the requirements for the window opening area to be at least 5.7 square feet, and the sill height is more than 44 inches above the floor.  So it seems like there is risk the whole lower unit could be deemed non-conforming if I were to do a significant renovation.  I don't know everything that counts towards being a significant renovation, but it sounds like this could be a significant risk.

@Mike Catalfamo

The physical opening of those bedroom windows is large enough if you were to replace the slider with a tilt-n-turn or casement window {tilt-n-turn is better as it opens inward and is less likely to be obstructed by snow, leaves or other objects}.

The 44" in a basement can be a challenge.  We have "built-in" desks under the egress windows in one of our student rentals, so the window can be easily reached.