Quadplex Comps for ARV and Price - South Carolina

[Junior Salters]

Hey guys,

I know quadplexes are not technically considered commercial properties and so their value is computed off of comparable sales within the given area. What do you do when there have not been many if any quadplexes sold within the given 6 months to a year or longer? I'm currently working off of the numbers I need to make a deal considering market rents, but I understand these deals aren't technically viewed that way. Any suggestions or help would be great!

[Joel Owens]

Set minimum cash flow goals for investment with a property. Make sure in the contract you have an appraisal contingency where you can terminate if property does not appraise or the seller has to lower the price. You do not want to have to bring additional down payment money to get a loan to close or risk losing your earnest money etc.

Have there been duplexes or triplexes more recently sold as comps? Have you checked not only MLS but tax records for private sales?

Also some appraisers and brokers/agents do BPO's on properties which is an opinion of value for a nominal price ( Usually a 100 or below for average).

If not many sales are available be conservative in value. Seller might be more optimistic but buyers with limited market data need to be more cautious.

Even without recent sales you can look at rent growth for an area for trends and vacancy rates.