Investor · El Dorado Hills, CA · Member since 2012 · 1k+ posts · 1k+ votes
I understand they will appreciate at a much lower rate than a SFR but if I am looking for long term cash flow what are the other downsides to investing in a half plex? Obviously I am trying to buy both sides if possible but single sides are available and approx 10% less. I found a nice pocket of class b/c homes here in Sacramento that sell for $39-45k but rent for $800. Those numbers are not easy to find in CA so I am trying to figure out what the catch is.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
14y
I recently bought another SF (detached) house, and when I was looking for it I saw a LOT of half plexes for sale. The biggest concern I had is that you don't own/control the whole building.
What if the person who owns the other half doesn't care about his half and it gets run down, needs capital expenses (i.e. a roof, etc) that he isn't willing to pay for, or doesn't care who he rents to and puts the tenants from hell in there? All of that is going to impact a half plex a lot more than if it was a detached neighbor doing those same things.
The numbers you put up sound decent, but I'd also do your research on the other half plex and it's owner and occupants.
Nick J.,
Hi Nick, in some areas of the country, a Duplex is sold as two separate residences.
Each owner is responsible for their side of the property.
I've seen this in Pa.
West, MI · Member since 2012 · 674 posts · 182 votes
14y
Joe Bertolino
My $0.02, I won't touch them, they are called zero lots here. I only know of one grouping in my area but they are getting old, built in ~1978. Roofs have already been replaced and everybody does their own thing so they have two diffrent types of shingles on each unit. Noise is a problem in a multi we own we can control the other side of the wall. The units in my area are in need of vinyl siding over the orginal wood exterior. The people never seem to agree and there is two diffrent types of exterior that looks goofy. Some of them are painted two diffrent colors, again goofy looking.
It may be diffrent in your area or more the norm but here there is other places I will put money in, always paying more, to avoid these things. My insurance inspector has one and the one on the other side went foreclosure so he ended up with a duplex by chance.
Investor · El Dorado Hills, CA · Member since 2012 · 1k+ posts · 1k+ votes
14y
Ryan, it does not appear any of those issues are present. They were built in the late 80's and the roofs, siding and paint all match. It is a primarily Asian neighborhood that is well maintained for the price point. They garden in the front and back yards. In talking to the neighbors, it seems like I could easily fill vacancies with their relatives or church members from a large congregation about two blocks away. I normally would not go for a half plex but the numbers look good.
Flipper · Carlsbad, CA · Member since 2011 · 115 posts · 20 votes
14y
I only owned one in the past and won't do it again. When we sold our unit VA, we needed termite clearance. The adjoining neighbor wouldn't agree to pay 1/2 of the termmite cost to tent the bldg. We absorbed the whole cost, which of course was double. The neighbor got free termite work, just so we could close the deal. The lender would not accept alternative treatment for just our side. We're lucky we never had roof issues during the ownership.
If there is no HOA, one side can get really run down, affecting values for your side. Not much you can do about it without HOA enforcement. Just my $.02.
West, MI · Member since 2012 · 674 posts · 182 votes
14y
Originally posted by Joe Bertolino:
Ryan, it does not appear any of those issues are present. They were built in the late 80's and the roofs, siding and paint all match. It is a primarily Asian neighborhood that is well maintained for the price point. They garden in the front and back yards. In talking to the neighbors, it seems like I could easily fill vacancies with their relatives or church members from a large congregation about two blocks away. I normally would not go for a half plex but the numbers look good.
Joe Bertolino
Sounds like the ones in your area are much better, for now anyway.