Potential first multi-family property... are these good numbers ?

[Lance Nelson]

This is my first potential multi-family deal so I’m understandably a little nervous.

I currently have a townhouse with a mortgage of about 1700 and it would rent for about 1750. It’s in a desirable location (Happy Valley, OR) and I think it has good appreciation potential.

I’d like to house hack a 2-4 unit multi-family and I found a triplex in a more rural area that has the following numbers after all units would be rented (a year after purchase):

FHA 3.5% down loan

Cash flow 250-300

ROI 18%

Cap rate 6.2

I could rent out the other units and live for about 600/mo for the next year. It’s in a more rural area and I feel that the appreciation potential isn’t as good.

Bottom line:

I have enough saved for the down payment and a little more and I’m tying to decide if I...

A) buy the triplex and rent out my townhouse, taking a small loss on the townhouse to hold onto a good property/location.

B) buy the triplex and sell my townhouse, freeing up about 20000 after fees.

C) stay in my townhouse and just sit back and see what happens with the housing market (recession?)

D) sell my townhouse and just sit back and rent for a bit to see what happens.

Experienced real estate investors, what would you do?!?!