Looking for guidance with triplex

[Nathan Strahan]

Hello BiggerPockets community,

I recently came across a property listing by an owner/listing agent. I've gathered some information and would greatly appreciate any insights and advice. The property is listed for $170,000. I am scheduled to view the property next week, but I am curious what you advise me to ask and/or look for during the showing. Information that I currently have:

Unit Configuration:

The home is divided into three separate one-bedroom, one-bathroom units.Two units are located downstairs, while one unit is situated upstairs.

Interior Condition:

The units have not been updated recently and are currently rented in their current condition.

HVAC:

I was told by another investor that viewed the property they  had not see any central heating or air conditioning units.

Given the absence of central HVAC, I'd like to gather insights on potential buyer considerations, alternatives for providing heating and cooling in individual units, and any impact this might have on the property's market value or rental demand.

This information provided by the owner/listing agent:

Rent Roll:

1. Unit 1: Currently at $450 with a planned increase to $575.
2. Unit 2: Currently at $575 with a locked 1-year lease.
3. Unit 3: Currently at $650 with a locked 1-year lease.
4. Security Deposits:
   • Unit 1 and 2: $200 security deposit.
   • Unit 3: $650 security deposit.
   Utilities and Expenses:
5. Tenants pay all utilities except water, which costs approximately $75 to $100 per month.

   I'm curious about best practices in managing utility costs and if there are strategies for optimizing water expenses.

6. Repairs and Maintenance:

   Recent major replacements: roof, water heaters, and plumbing lines within the last 2 years.

7. Condition of the Property:

   The property is priced low due to the need for interior work, primarily cosmetic.

8. Any expertise and advice would be immensely valuable as I consider this investment opportunity. Thank you in advance for your time and insights!

[Melanie P.]

HVAC is probably baseboard electric heat and tenant-supplied window AC in summer. Confirm at showing. 

You can use ratio billing to bill through the water bills to the tenants as their leases come up for renewal. 

Sounds to be priced a bit high for the type of housing it is. Based on the rents I would think 150k is top of market and that is why it's not moving quickly.