Interesting Duplex deal in Kingston
Hey BP,
Looking at an interesting Duplex deal in Kingston and wanted to hear what you guys thought.
Property:
- Address: 123 Russel Street
- Duplex with 2 above grade units
- Both units are 2 bed 1 bath
- 25 min walk to Queens U
- 15 min walk to groceries, entertainment on princess
Financials:
- Asking Price: $279,900
- Revenue:
- Potential Rent: $1100 per unit ($26,400 annualized)
Operating Expenses:
- R&M: $200 per month
- Prop. Management: $162 (8% of monthly rent)
- Insurance: $125 per month
- Prop Taxes: $250 per month
- CapEx Reserves: $83 per month
- Mortgage: Assuming 20% DP ~$872 monthly payment
Risk and Return Metrics:
DSCR: Minimum of 1.4x in year 1
Debt Yield: Minimum of 7.05% in year 1
Levered IRR: 12.63%
Levered Equity Multiple: 2.82x
Levered CoC: Year 1 - 4.48% Year 10 - 8.56%
Levered Cashflow in Year 1: $3,404
Levered Cashflow in Year 10: $6,502
Potential Asset Management Strategies:
- Finish lower basement to convert to triplex and add add and additional 2 bed 1 bath unit
- Renovate current units to raise rents by 20%-25%
- Manage property personally to decrease OpEx
I don’t currently have the funds to go after this deal so I thought I would throw it out here and get your opinions on it. Do you think this is a good deal? Would you go after it if it were in a market you usually invest in?