Where are the Deals for 4plexs and Duplex's in Utah?

Salt Lake City, Utah
Buying & Selling Real Estate
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Where are the Deals for 4plexs and Duplex's in Utah?

Nate Powley
Member since 2023 · 10 posts · 0 votes

My Summary of trying to find the best deals for 4plexs and Duplex's in Utah

The 3 main areas i know are Davis county, Slc county, Utah county

Affordability:

SLC county has by far the most expensive properties with nice 4plexs going for over 1.2 million. The most ghetto areas of SLC county with beat-up 4plexes and Duplex's are about the same price as Davis and Utah county's best small 4plexs and Duplex's. Davis County is slightly cheaper than Utah County and likely has better growth, I would say this area is best area to target.

Fix and Flip Opportunities:

The current market is not great for fixing and flipping 4plexs and Duplex's in Utah, On all of me and my investors recent purchases, the ARV is not great and I think that caprates uncompressing is hurting this type of strategy as well. There are also not a lot of very beat-up properties in the Utah market as well. I would not recommend this strategy.

Deals:

The markets have been stagnant for the last 9 months, prices have not risen and expensive properties with higher rents are having trouble selling, even if they are at the same market caprate. Caprate is between 5.5%-6.5%, anything over 6.5% is a great deal. Seller financing opportunities have been growing in popularity.


Most Recent Deal (March 2024):

I purchase a double duplex in SLC county, in Glendale, has some mailbox theft issues. The property is a 7% caprate, this the best deal I've seen personally in the last 9 months, it was an off market seller who is doing seller financing. I purchased the property at 755k @ 5% interest with a 10 year a balloon. 205k downpayment. The property has been fully renovated, but has yard and fence that need to be fixed up. Rents are currently $1,200 per month, I expect to raise them to $1,375 per month when I add a storage container and do exterior fix ups (30k), the monthly payment is $3,660, so $5,500-$3,660=$1,840, so $22,080 cashflow per year.

Summary:

Utah is an increasingly expensive market. It has great appreciation, great rent growth, and great landlord friendly laws.

Ask me any questions you have about the Utah market!

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Logan M.
Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
2y
Quote from @Nate Powley:

My Summary of trying to find the best deals for 4plexs and Duplex's in Utah

The 3 main areas i know are Davis county, Slc county, Utah county

Affordability:

SLC county has by far the most expensive properties with nice 4plexs going for over 1.2 million. The most ghetto areas of SLC county with beat-up 4plexes and Duplex's are about the same price as Davis and Utah county's best small 4plexs and Duplex's. Davis County is slightly cheaper than Utah County and likely has better growth, I would say this area is best area to target.

Fix and Flip Opportunities:

The current market is not great for fixing and flipping 4plexs and Duplex's in Utah, On all of me and my investors recent purchases, the ARV is not great and I think that caprates uncompressing is hurting this type of strategy as well. There are also not a lot of very beat-up properties in the Utah market as well. I would not recommend this strategy.

Deals:

The markets have been stagnant for the last 9 months, prices have not risen and expensive properties with higher rents are having trouble selling, even if they are at the same market caprate. Caprate is between 5.5%-6.5%, anything over 6.5% is a great deal. Seller financing opportunities have been growing in popularity.


Most Recent Deal (March 2024):

I purchase a double duplex in SLC county, in Glendale, has some mailbox theft issues. The property is a 7% caprate, this the best deal I've seen personally in the last 9 months, it was an off market seller who is doing seller financing. I purchased the property at 755k @ 5% interest with a 10 year a balloon. 205k downpayment. The property has been fully renovated, but has yard and fence that need to be fixed up. Rents are currently $1,200 per month, I expect to raise them to $1,375 per month when I add a storage container and do exterior fix ups (30k), the monthly payment is $3,660, so $5,500-$3,660=$1,840, so $22,080 cashflow per year.

Summary:

Utah is an increasingly expensive market. It has great appreciation, great rent growth, and great landlord friendly laws.

Ask me any questions you have about the Utah market!


 Do you feel like that purchase was worth it since you had to put so much money down?

I think the interest rate is nice in this market but the return on your money annualized looks low, I am just curious what I am missing. Maybe the play is appreciation?

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  • Logan M.
    Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
    2y
    Quote from @Nate Powley:

    My Summary of trying to find the best deals for 4plexs and Duplex's in Utah

    The 3 main areas i know are Davis county, Slc county, Utah county

    Affordability:

    SLC county has by far the most expensive properties with nice 4plexs going for over 1.2 million. The most ghetto areas of SLC county with beat-up 4plexes and Duplex's are about the same price as Davis and Utah county's best small 4plexs and Duplex's. Davis County is slightly cheaper than Utah County and likely has better growth, I would say this area is best area to target.

    Fix and Flip Opportunities:

    The current market is not great for fixing and flipping 4plexs and Duplex's in Utah, On all of me and my investors recent purchases, the ARV is not great and I think that caprates uncompressing is hurting this type of strategy as well. There are also not a lot of very beat-up properties in the Utah market as well. I would not recommend this strategy.

    Deals:

    The markets have been stagnant for the last 9 months, prices have not risen and expensive properties with higher rents are having trouble selling, even if they are at the same market caprate. Caprate is between 5.5%-6.5%, anything over 6.5% is a great deal. Seller financing opportunities have been growing in popularity.


    Most Recent Deal (March 2024):

    I purchase a double duplex in SLC county, in Glendale, has some mailbox theft issues. The property is a 7% caprate, this the best deal I've seen personally in the last 9 months, it was an off market seller who is doing seller financing. I purchased the property at 755k @ 5% interest with a 10 year a balloon. 205k downpayment. The property has been fully renovated, but has yard and fence that need to be fixed up. Rents are currently $1,200 per month, I expect to raise them to $1,375 per month when I add a storage container and do exterior fix ups (30k), the monthly payment is $3,660, so $5,500-$3,660=$1,840, so $22,080 cashflow per year.

    Summary:

    Utah is an increasingly expensive market. It has great appreciation, great rent growth, and great landlord friendly laws.

    Ask me any questions you have about the Utah market!


     Do you feel like that purchase was worth it since you had to put so much money down?

    I think the interest rate is nice in this market but the return on your money annualized looks low, I am just curious what I am missing. Maybe the play is appreciation?

    1Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y

    I agree with everything you said there. It was very cash heavy with 205k down. The appreciation is definitely a big aspect of it, its surrounded by moderate density projects that have just been rezoned and its in a zoning node.


    I also believe I got it below market value enough that I could resell it and make a profit instantly, so that played a part in the investment for me

    0Reply
  • Jeremy Jareckyj
    Real Estate Agent · Salt Lake City, UT · Member since 2020 · 490 posts · 205 votes
    2y
    Quote from @Logan M.:
    Quote from @Nate Powley:

    My Summary of trying to find the best deals for 4plexs and Duplex's in Utah

    The 3 main areas i know are Davis county, Slc county, Utah county

    Affordability:

    SLC county has by far the most expensive properties with nice 4plexs going for over 1.2 million. The most ghetto areas of SLC county with beat-up 4plexes and Duplex's are about the same price as Davis and Utah county's best small 4plexs and Duplex's. Davis County is slightly cheaper than Utah County and likely has better growth, I would say this area is best area to target.

    Fix and Flip Opportunities:

    The current market is not great for fixing and flipping 4plexs and Duplex's in Utah, On all of me and my investors recent purchases, the ARV is not great and I think that caprates uncompressing is hurting this type of strategy as well. There are also not a lot of very beat-up properties in the Utah market as well. I would not recommend this strategy.

    Deals:

    The markets have been stagnant for the last 9 months, prices have not risen and expensive properties with higher rents are having trouble selling, even if they are at the same market caprate. Caprate is between 5.5%-6.5%, anything over 6.5% is a great deal. Seller financing opportunities have been growing in popularity.


    Most Recent Deal (March 2024):

    I purchase a double duplex in SLC county, in Glendale, has some mailbox theft issues. The property is a 7% caprate, this the best deal I've seen personally in the last 9 months, it was an off market seller who is doing seller financing. I purchased the property at 755k @ 5% interest with a 10 year a balloon. 205k downpayment. The property has been fully renovated, but has yard and fence that need to be fixed up. Rents are currently $1,200 per month, I expect to raise them to $1,375 per month when I add a storage container and do exterior fix ups (30k), the monthly payment is $3,660, so $5,500-$3,660=$1,840, so $22,080 cashflow per year.

    Summary:

    Utah is an increasingly expensive market. It has great appreciation, great rent growth, and great landlord friendly laws.

    Ask me any questions you have about the Utah market!


     Do you feel like that purchase was worth it since you had to put so much money down?

    I think the interest rate is nice in this market but the return on your money annualized looks low, I am just curious what I am missing. Maybe the play is appreciation?


     Doesn't seem terrible. 10.7 % return on the down payment. It is quite a bit down that and may lock you up a bit in the short term.

    0Reply
  • Jeremy Jareckyj
    Real Estate Agent · Salt Lake City, UT · Member since 2020 · 490 posts · 205 votes
    2y

    I think this is a solid deal if you are happy with the more significant downpayment. 

    best multi family deals I have seen on the MLS or off market have all been seller financing in the SLC valley over the last year.

    0Reply
  • Logan M.
    Investor · Provo, UT · Member since 2016 · 759 posts · 626 votes
    2y
    Quote from @Nate Powley:

    I agree with everything you said there. It was very cash heavy with 205k down. The appreciation is definitely a big aspect of it, its surrounded by moderate density projects that have just been rezoned and its in a zoning node.


    I also believe I got it below market value enough that I could resell it and make a profit instantly, so that played a part in the investment for me


     I would look for the opportunities for highest and best use via development. It could be a 5-10 year play but you can be patient because you are already in the deal.

    1Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y
    Quote from @Jeremy Jareckyj:

    I think this is a solid deal if you are happy with the more significant downpayment. 

    best multi family deals I have seen on the MLS or off market have all been seller financing in the SLC valley over the last year.


     I agree with you, seller financing has been the best deals i have found

    0Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y
    Quote from @Logan M.:
    Quote from @Nate Powley:

    I agree with everything you said there. It was very cash heavy with 205k down. The appreciation is definitely a big aspect of it, its surrounded by moderate density projects that have just been rezoned and its in a zoning node.


    I also believe I got it below market value enough that I could resell it and make a profit instantly, so that played a part in the investment for me


     I would look for the opportunities for highest and best use via development. It could be a 5-10 year play but you can be patient because you are already in the deal.


     hmm thats interesting, i'll have to research that some more

    0Reply
  • Dan Rowley
    Investor · Cary, NC · Member since 2012 · 218 posts · 196 votes
    2y

    @Nate Powley  Hi Nate,  I'd suggest the good 'deals' in UT market left the station several years ago, but that would not be helpful.  I own several there and I do have a referral on new construction BTR 4-plexes if interested DM me.  

    0Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y
    Quote from @Dan Rowley:

    @Nate Powley  Hi Nate,  I'd suggest the good 'deals' in UT market left the station several years ago, but that would not be helpful.  I own several there and I do have a referral on new construction BTR 4-plexes if interested DM me.  


     Thanks for the suggestion

    Have BTR 4-plexes been profitable for you in utah?

    0Reply
  • Dan Rowley
    Investor · Cary, NC · Member since 2012 · 218 posts · 196 votes
    2y

    @Nate Powley  yes, more profitable than I could have hoped for even.  But I bought in at lower cost basis before the market values really jumped up and I also secured low rate fixed conventional financing - as I bought several years ago.   So, the timing worked out in my favor, though this is not always going to be the case.

    0Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y
    Quote from @Dan Rowley:

    @Nate Powley  yes, more profitable than I could have hoped for even.  But I bought in at lower cost basis before the market values really jumped up and I also secured low rate fixed conventional financing - as I bought several years ago.   So, the timing worked out in my favor, though this is not always going to be the case.


     My Dad is a contractor who has built multi-family properties for other people in the past, but he hasnt built anything for himself or smaller than 20 units


    I have been suggesting the idea of building a 4plex to him for the past few months and we each forgo our fees and split the profits of the deal


    I'm curious as to what your numbers were like on a btr 4plex, such as the land cost and the construction cost at the time you built it?


    im not seeing very cheap land in utah to build a 4plex in a city rn, its in the 400k range for a lot, and then it would sell for 1 million

    0Reply
  • Dan Rowley
    Investor · Cary, NC · Member since 2012 · 218 posts · 196 votes
    2y

    Nate - that's right land jumped up for sure.  I bought a few years ago in the 700-800k range, with the lower being total sq. footage around 4,000 and the higher being like 5,000+ sq. ft. These would now go for over 1M - 1.1M minimum and at peak a couple years back with lower financing were worth ~1.2 - 1.3M.

    0Reply
  • Nate Powley
    OP
    Member since 2023 · 10 posts · 0 votes
    2y
    Quote from @Dan Rowley:

    Nate - that's right land jumped up for sure.  I bought a few years ago in the 700-800k range, with the lower being total sq. footage around 4,000 and the higher being like 5,000+ sq. ft. These would now go for over 1M - 1.1M minimum and at peak a couple years back with lower financing were worth ~1.2 - 1.3M.


     Ok thanks for confirming for me, I would love to do BTR 4plex's because of my dad being a contractor and we could forgo our fees to make it cheaper, but it just doesnt seem feasible, and i don't see any currently being built at that size

    I appreciate your answers! Thanks a ton

    0Reply
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