Memphis Multi-Units

[David Hodge]

How are multi-units in Memphis? I've been learning a lot about SFR's but recently starting thinking about buying a multi-unit (2, 3 or 4 units). I want to be in a B neighborhood. What areas should I look in? Is Memphis even good for multi-units? What is the current CAP rate in the area? I'd appreciate any info you can give! Thanks!

[Douglas Skipworth]

Hi, @David Hodge.

Class B multi-units (2-4 doors) are great in Memphis if you can find them.

We own and/or manage over 100 duplexes, triplexes, and quadplexes (A, B, and C's) and I'm not joking when I tell you that some of the residents in those units have lived there longer than 25 years (mostly in the B and C areas, though)!  

Of course, there are other units that turn over every year.

Berclair (38122) is a great B neighborhood where we have had tons of success with duplexes. Unfortunately, there are not many for sale these days.

We've also had good luck in Midtown (38104) with 2-4 units, but sometimes they are A properties because of where they are located (several areas in Midtown are very hot right now).

There are also pockets of 38111 that have a few nice duplexes.

Again, the hard part is finding one for sale at the right price.

I asked the Assessor's office one time and they told me that there are roughly 6,000 2-4 unit properties in Shelby County (compared to about 300,000 single family).

A local Realtor could easily pull a list of all the 2-4 unit listings in the local MLS. And, you could also ask around for pocket listings of duplexes, too.

Be sure to ask the BP community when you find some to make sure you are looking at B properties and not C properties that someone is trying to tell you is a B.

Overall, I think multi-units can be an awesome investment if you find the right property.

All the best,