Deal review for a duplex
I'm a new investor and looking for your opinion on a deal that got my attention.
Place: Houston
House: Duplex, 3bed 3bath 2000 sqft each unit.
Price: 350k (slight room for negotiation)
Rent: tenant 1 is paying $1200 month to month lease and 2nd unit just got vacant. Market rate around that area is $1600
There is no upgrade required before I can rent the other unit.
Questions:
1. How easy it is to increase the rent in Houston? Tenant 1 is paying $1200 from past 2 yrs which is way under the market price.
2. Once a tenant has month to month lease, can you convert it back to 1 year lease?
3. Even if I rent the other unit for $1600, it does not meet the 1% rule. So should I even consider this deal?