HELP! Pricing a Duplex Flip?

[Candace Berry]

We are considering renovations on a 1500 sq/ft duplex in Durham, NC that is 3 blocks from NCCU and 3 miles from downtown. I understand you price multi-family based on the rent it brings instead of the sold SFH comps in the area. However, is the 1% rule enough to decide ARV?

(Flipped homes before, never a duplex.)

Here is the current plan, PLEASE correct or comment any or all of our assumptions.

1. Purchase and renovate in 3 months.
2. Rent both sides for $800 (feel confident about this number possibly even $850)
3. Hold for 6 months to show good rental history and that it will rent for this amount.
4. Make $9,600 in rent (minus expenses of course - used BP rental calc)
5. Sell to Investor wanting turn key rental for $160,000 using 1% rule
6. OR Sell to Investor for 155,000 to beat 1% rule by a little to sell faster????
7. Should we sell it for MORE based on other numbers below I haven't considered??
8. Make money on rent until it sells (unlike flip, it makes while it waits)

Thank you for any and all suggestions. 

Candace

Here are some of the numbers from our rental calculator results if this helps. 

(This is a cash buy/reno.)

Monthly Income: $1,600.00	Monthly Expenses: $447.67	Monthly Cashflow: $1,152.33	Pro Forma Cap Rate: 8.64%
NOI: $13,828.00		Cash on Cash ROI: 9.54%	Purchase Cap Rate: 19.21%

[William Hochstedler]

Duplexes will be appraised (valued) by the comparison approach, not the income approach which is reserved for properties with more than 4 units.

Do it just as you would for SFR except compare your subject property to other duplexes sold in the area.