Sold $1,100,000 - Triplex
OK, this one I really like, for several reasons:
1. I did a drive-by and the location is great; it has lots of parking; the front house is totally separate from the back two units, and they all appear to be in great shape.
2. The property is listed on the MLS as “On Hold” so competition right now should be very limited. I spoke to the agent and the property is definitely for sale despite showing as “On Hold.”
3. She is showing the “pro forma” rent for the front house (which will be delivered vacant) as $2600. She is not from the area and doesn’t realize this is about $1400/mo below what it will actually fetch. It is a 3-bed, 2-bath, 2000 sq ft (!) house with its own yard, parking, etc.
4. The rear tenants are not paying such low rent that it would be difficult to negotiate them out. If you did negotiate them out, the 1-bed unit would fetch approximately $1600/mo as opposed to the $1400/mo it is currently getting, and the 2-bed unit would fetch approx $2000/mo as opposed to the $1625/mo it is currently getting.
And lastly….
5. There may be some wiggle room in the price. If you can get it at $1,050,000 and negotiate the tenants out, you will have a $1500/mo (approximately) cash flow on an upside property that will only grow in value.
I would jump all over this. This is the kind of “perfect storm” I look for and rarely find.
