How do I BRRRR a Duplex?

[Daniel OKeefe]

I just made an offer on my first duplex. The financials and cash flow are great, however I want to be able to get my cash back out to put into the next property. Both units are rented at $1100/mo each and market rent is currently $1400-1500 each side.  Also they could use light updates- paint, flooring and maybe cabinets. How to I improve the value of a duplex so I can refinance my money out?  Is it totally dependent on the income it produces so or will it appraise higher just with updates like a sfh would?

[Jordan Grimstad]

@Daniel OKeefe Based on the responses in this discussion, it looks like an appraiser would use a combination of appraisal approaches to determine the value. That said, I'm not certain if the promise of better market rents (vs. what it's currently actually renting for) is good enough to influence the appraiser's valuation. You might need to actually prove that people are willing to rent the units at the higher value by actually getting them rented at that higher value.