I need some expertise help regarding a property situation.
I found a 4 plex but it’s 2 houses with 2 duplexes in each. And the houses needs a total gut rehab. What are your thoughts on turning them in to two single family houses and live in one and rent the other one so we live for free?
The location is in Naples Florida and the rents for 2 bed 1 bath is roughly $1200 and $3600 for 4 bed 2 bath.
Hi @Andreas Thuresson ,
Your rent estimation does seem a bit high on the 4/2. While in theory this looks like a great plan, the key in execution would be the balance between renting for your target price, and ensuring the vacant unit rents quickly to minimize holding costs. If you're confident in the numbers, then this looks like an easy decision. If you're questioning, it's definitely better to get a second opinion. Shoot me a message with any questions and I would be happy to help!
@Andreas Thuresson , are the two duplexes on separate parcels or the same? If the same, are they legal? I cannot speak for Ft Myers, but in Cincinnati, when you apply for any permits they look at the current use, setbacks, etc and make sure you are legal conforming. While you only need variances if you are doing an addition, for legal non-conforming, if you have an illegal use i.e. two buildings on a lot zoned single family, you could be opening up a can of worms making the project not worth it.
Assuming all checks out from a zoning stand point, I will say typically, you can get more gross rent from a duplex than a single family home of comparable size. Again, I don't know this market, although it seems Stetson does. Also, assuming it is an area you want to live (fyi, you can live for free if you buy, rent all four units, and cashflow more than your rent in a neighborhood you want to live in too) I would look at converting 1 of the buildings to a single family to live in and keep the other as a duplex.
Thanks for the information guys.