Skip to content
×
PRO
Pro Members Get Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
$0
TODAY
$69.00/month when billed monthly.
$32.50/month when billed annually.
7 day free trial. Cancel anytime
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Buying & Selling Real Estate
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 4 years ago, 04/08/2020

User Stats

16
Posts
2
Votes
Patrick Slagle
  • Investor
  • Richmond, VA
2
Votes |
16
Posts

Contemplating Duplex Purchase

Patrick Slagle
  • Investor
  • Richmond, VA
Posted

Background:

I live in Richmond Virginia, and looking to purchase my first property, a duplex in an up and coming neighborhood. The plan is to do a classic live in flip, BRRR, and then move on to the next property. The numbers looked good, I put an offer down (before COVID-19), and in the final stages of escrow. Now the main question is, do I continue through? Or wait until the market bottoms to get a better deal?

Details:

- Current purchase price: 255k

- Duplex is in fair/decent shape. Houses fully rehabbed on that street were selling for roughly 370k

- 3.5% FHA loan

- Seller credits: 15k (5k will be to cancel out closing credits, 10 to rehab)

- Expected rent per unit: 1200 (pre COVID-19)

- Expected cash flow: $450/month (pre COVID-19)

- Expecting putting in another 10k into the property

- I'm in a financially good position at a decent job

Pros of buying:

- Duplex is on a great street mostly turned over surrounded by a neighborhood that's growing. 

- Its a duplex which is hard to find in Richmond. Especially where I'm looking

- even if the rent goes down 20%, I'll still cash flow. 

- got a great FHA rate. Bought the bottom. More important than the rate, this is allowing me to cancel out more closing costs

- Start gaining experience in rehabbing and real estate

- its a long term investment, even if the market dips, it'll still be profitable. 

- if the market dips, I could buy again in 6-12 months. This is probably when you'd see the bottom for real estate anyways.

Cons

- could get a better entry by waiting

- probably will get a worse renter, and not as much rent as expected

- The effects of COVID-19 are uncertain. No one knows how bad this will get.

- Probably can't BRRR for a while

Loading replies...