Hello! Just hoping to get some feedback on a triplex I am looking at. Unit a rents for 365, unit b rents for 350, and unit c rents for 750. The big unit is 3 bedroom 2 bath and 1900sq ft and the 2 small units are 1 bedroom one bath 700 sq ft. I would classify this property as a C property in a B neighborhood if that makes sense... the inside is in excellent condition. The management company it is with said there has been minimum vacancy in the last 3 years. The only issue is that it is right next to a railroad crossing. I mean it's parking lot borders the railroad crossing. I'm just curious to any experience with C properties located this close to a train? (A very active train)I own a duplex not far from here in the B neighborhood, and have no trouble renting it.
This is just really close so I thought I would ask the BP forum for my first BP post!
Evaluate it by the cash flow only.
Consider you will have to sell it some day
Rent sounds low. Perhaps location is why
I had a run in with a train track behind a SFH I was going to buy, the crossing was about 1/3 of a mile away from the home. I believe it would have sparked a LOT of turn over rates. I talked to a few of the neighbors. Asking how often it goes by and if after a while they got used to it. After talking to a few neighbors, it seemed to go by about 3 times a day, once in the middle of the night. It shook the houses and the horn was obnoxious. One guy had lived there for 3 years and says he hates it and he never got used to it. He said no one likes living on this street, housing was just really cheap here.
So I passed up on that house, knowing that most people will not want to stay there very long. If you can get the triplex for the right price... you can always make it work. I would do a little more research and find out more about the train that goes by, if it uses its horn (Probably since its by the crossing) and if there are any signs that the company that uses it will stop.
Personally, I would not invest in houses so close to RXR. It really drives people away. I hope that gives you some insight. Let me know if you have any other questions
Thanks for the advice! Cash flow would be around 300 per month with 20% down. I also factored In a 10% vacancy, 15% management fee, and 15% in cap ex and everyday repairs, and of course taxes, insurance, etc.. this was a 92,000 purchase price scenario. I feel like I have over estimated expenses, and everything makes sense, but I'm just stuck.. asking price was 120,000, offer was 73000, and they countered at 100,0000.
Thanks for all the advice!
He won with this deal. I just bought it from him for 121k. I plan to get the rents to 1800/month. Not sure about keeping the property manager yet. Just depends on the vibe.
External obsolescence. No doubt it hurts...how much you have to determine.