Potential duplex rehab worth it?

[Jacob Northfield]

Hey folks, 

I'm new here and researching SMF homes in Rochester (Edgerton) and I found something that might work for me, but I'm not sure if I'm thinking about this correctly. 

The asking price is $80k and I'm securing a conventional loan with an assistance loan for the down payment and closing costs. There is a tenant in one apartment paying well below market rate. The realtor suggests that I could rent it in current condition for $1,000 in this neighborhood and this checks out with the rents I'm seeing. Unfortunately, the existing tenant is in the process of being evicted for non-payment since June, though I can afford the expenses on a monthly basis without tenants, including mortgage, insurance, and utilities, etc, as well as savings for vacancies etc, so I feel relatively confident that I can manage if the eviction takes time or if I can't find a new tenant for that apartment immediately. 

The other apartment will be mine and I will be renovating slowly with cash to hopefully bring that rent up to $1,200 or so, however, I will be responsible for approx $650/mo if I only have one tenant while I fix up the other apartment. That being said, expenses at $650/mo will save me $500/mo on rent.

Any thoughts on this deal? I know it isn't perfect, but if I can renovate both apartments and raise the rent to market value then I estimate I will bring in at least $100/mo/door after all expenses. Should I take a loss for the time period it takes me to do my own renovations or do I ditch this deal? The renovations appear to be cosmetic.

Thanks!