Stuck in the Duplex Doldrums!
Hey gang - I’m sure you’re all feeling the same pain… so few deals and such little time!
I’ve been scraping the FMLS day in, day out for WEEKS looking for a Duplex with little to show for my efforts. Planning a door knock / direct mail approach next but please, if you or anyone you know is looking for a cash buyer in the Atlanta area you’ll help save me from total insanity - and get me out of the Duplex Doldrums!!!
Thanks for listening,
Adam
Hey @Adam Charlton, welcome to the BP community!
Only weeks? Well strap in and prepare for MONTHS of searching. We stopped looking at small MF in Atlanta a while ago. There just isn't a ton of it and what does exist is often traded off-market or for ridiculous prices on the market. And this was before the current residential housing supply shortage.
My advice would be to forget about the MLS and go straight to direct to seller strategies. There are obvious pockets of small MF in the metro and you could spend some time driving around these to get a feel for what's out there. However, most will be rental units so I'd recommend finding a way to reach the owner, rather than door knocking.
Now, if you're just looking for cash flow and economies of scale, you might want to look into coliving. Atlanta is a great market for the strategy because there are a ton of single family homes but a lack of affordable housing. We're always looking for cash buyers to help get started with coliving. Feel free to reach out anytime if you have questions or want to discuss further!
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Real Estate Agent Georgia (#401878)
- 404.737.0018
- [email protected]
In addition to looking into Coliving opportunities, you should look into properties that are naturally divisible or added to for more 'units'. You should know that a 'dwelling unit' is a defined legal term. However, you can get pretty close to a dwelling unit if you don't add the stove or stove hookup.
For Dividing into units: Here's an example. Single Family House with a daylight basement is not a duplex. However, you can set up a separate, private entry, egress, bathroom, and a "hell of a wet bar" (like a kitchen with no stove) in the basement and rent it out. More utilities will be shared than a duplex, e.g. water and electric. $20 - 50k rehab to fully build out a nice basement. Attics can work too if the entry can be made somewhat private.
For Adding a unit: Here's an example. Single Family House, great location, small house, a nice level yard, and a garage would be a bonus. The idea here is to add a guest house or an Accessory Dwelling Unit to the rear of the house -- connected by at least a breezeway. A guest house is an ADU with no kitchen (really just no stove). You have to know what's allowed in your area. In this scenario, you have to build 800 sf, so additional rents need to justify the expense and brain damage. You'll want to do this in a pricier rent district. You built it for $160k, would you get $2k/mo rent?
Both. Do both build out the basement and add a guest house. Now you have three renters but still not a triplex.
Bonus. Build out the basement +1. Attached guest house +1. Detached ADU +1. Now you have a four renters in a single family zoning area.
Financing the additional rental units and getting your money back out is also very important. That's a discussion for another post.
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Developer
- GaREIA
@Adam Charlton I totally agree with everything said in the above posts. 2-4 unit small multifamily is tough to find on the market. If you know where to look, there are some fun and interesting ways to dig up off market deals in this space. Happy to connect and talk more about it!
I work with a handful of folks in your market who get off market leads for multi, sfr, and land. Atlanta, Decatur, Brookhaven.
Happy to show you some mail pieces and templates that are performing right now @Adam Charlton Cheers.
@Rick Baggenstoss Thank you for that post Rick, that was really informative. In your experience, which typically yields the best bang for one's buck?
Quote from @Rick Baggenstoss:
In addition to looking into Coliving opportunities, you should look into properties that are naturally divisible or added to for more 'units'. You should know that a 'dwelling unit' is a defined legal term. However, you can get pretty close to a dwelling unit if you don't add the stove or stove hookup.
For Dividing into units: Here's an example. Single Family House with a daylight basement is not a duplex. However, you can set up a separate, private entry, egress, bathroom, and a "hell of a wet bar" (like a kitchen with no stove) in the basement and rent it out. More utilities will be shared than a duplex, e.g. water and electric. $20 - 50k rehab to fully build out a nice basement. Attics can work too if the entry can be made somewhat private.
For Adding a unit: Here's an example. Single Family House, great location, small house, a nice level yard, and a garage would be a bonus. The idea here is to add a guest house or an Accessory Dwelling Unit to the rear of the house -- connected by at least a breezeway. A guest house is an ADU with no kitchen (really just no stove). You have to know what's allowed in your area. In this scenario, you have to build 800 sf, so additional rents need to justify the expense and brain damage. You'll want to do this in a pricier rent district. You built it for $160k, would you get $2k/mo rent?
Both. Do both build out the basement and add a guest house. Now you have three renters but still not a triplex.
Bonus. Build out the basement +1. Attached guest house +1. Detached ADU +1. Now you have a four renters in a single family zoning area.
Financing the additional rental units and getting your money back out is also very important. That's a discussion for another post.
Great input. Thank you.