Suggestions for a Duplex that has not Performed Well - Wisconsin

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Hi Everyone,

I'm just looking for some suggestions on what to do with a duplex that has never performed well (seems like we need to keep adding cash for repairs and maintenance all the time and/or tenants are coming and going very quickly - sometimes just 6 months or so).

My wife and I bought this duplex in 2006 in Kenosha, WI right before prices took a steep dive. I must have looked at nearly a hundred properties and put offers in on three, before getting this one accepted. I felt good about the numbers at that time... We ended up putting some money into the place to strip the roof and put a new one on, update the electrical from fuses to circuit breakers, paint, and buy new appliances for the upper unit. After this, we cash out refinanced about 15K because of the increase in value of the repairs. We ended up with a loan for 105K @ 7.15 % (bad rate because one of us had bad credit). I initially managed the property myself, but at the end of 2007 we moved to Las Vegas, NV so I had to hire a property management company. In any case, we had one year from 2006 to 2012 that we actually netted money on the property at the end of the year. We have been losing around 2K-4K a year otherwise. Because of our W2 income we are limited to just taking a sliver of our losses (we are renting out the SFH we lived in before we moved to NV and generating losses on that one because rent doesn't cover mortgage).

Fast forward to 2013 and we had our bank contact us to refinance the loan. We did a streamline refi and got down to a 5.158% rate, which definitely helped cash flow, but we still had a bad year in '13 with tenant turnover, plenty of maintenance, and a new furnace right in time for Christmas.

We still owe 103K on this house after the refi and it is probably worth about 60K. We are moving back to Wisconsin around August and my brother in law is a carpenter so I plan on doing some work with him to bring the property up to better condition in hopes tenants will stay longer, however, the property is not in good area so I'm worried I might be spinning my wheels here. As far as numbers now, rents are 1200 a month while mortgage, taxes, and insurance run 812 a month. Property management takes 9% and tenants pay all utilities except for water (about $30 a month).

Any suggestions on what my best move is with this duplex? Thanks in advance.