1investment Multi family

[Michael Behr]

I found a 4plex! (Occupied) I went and saw it today was supposed to see all 4 units only saw one. I like the one I saw. Realator said I should see the other 3. Can I offer contingent on seeing them? The occupants were supposed to let us in? Is this a red flag or proceed? Will be my first property 

[Richard F.]

Quote from @Michael Behr:

Quote from @Richard F.:

Aloha,

Who is the Realtor that showed the property...the Seller's, or was it YOUR Agent? (do you understand the legal concept of "agency" that applies here?) If it was your agent, they should advise you on reasonable contingencies for actual inspection that definitely should be in the purchase offer.

Either way, you can probably assume you saw the best of the 4 units and/or if the 3 other Tenants actually knew you were supposed to look at them but refused entry, likely is an indicator of less than stellar Tenants. Depends on how often they have had the imposition during the listing period.

How old and what type of construction is the property? That can often tell you much of what you need to "assume".

1965 site built

 In that case, assume the worst...if it has NOT been updated, electrical and plumbing are past their useful life. Either of these systems are likely to have multiple old repairs and modifications, which are/will become more frequently needed going forward.

Assume that subfloors/joists in the vicinity of kitchen sinks, bathroom fixtures will be significantly deteriorated.

Virtually guaranteed you will have asbestos containing materials that will need to be remediated, as well as quite likely lead based paint in some areas.

Odds are, the existing Tenants are very long term, under market, with fair to poor conditions. Be sure to get full documentation and transfer of SD for all Tenants, including estoppel letters and most current written Agreements; appliance ownership info (Tenant or Owner owned); and all other pertinent info. You should require NO new Rental Agreements be offered or signed prior to closing. Once the sale takes place, you would have each Tenant complete an application which would be vetted by you, with your criteria, and then you could decide if you wanted to offer new Agreements, and under what terms. Or give them notice of non-renewal per local law.