To Buy or to Build...

[Timothy Joseph]

Hey everyone, been lurking on here just a short time and seems to be a great community. I am pretty new to investing, I own two properties, a SFR and a Condo, both are rented. I would like to continue to grow my portfolio by adding a duplex etc. Here in Knoxville TN the availability of multi unit real estate is extremely limited, and in my opinion over priced. For example, a duplex went on the market with an ask of 208,000. They were two bed one bath units, about 850 SQFT each, and they were in horrible condition. It was pending in less than 6 hours of listing.

I have access to moneys to buy but my goal is to pay off all properties with an amortization schedule of 20 years, not using any cash down, and having the rent incomes pay all expenses and mortgage.  

This being said, I have found the ones that come on market provide a negative cash flow at a 20 year amortization.   They are also in dire need up updates.

Here's my question, I started thinking about purchasing land and building my own duplex.  Can anyone speak to the cost comparison of buying vs building?  Seems like I could likely build new for the cost of run down....