Dual living rental property. Good idea or death trap.

[Scott McGill]

Hi all, I've had a few investment properties that were already set up for dual living pop up but have passed on them until I learn more. The one I liked the best was a 4/3 having a 3/2 upstairs and a 1/1 down in seperat finished basement. I like the idea of one mortage two rents.

So here are a few questions

1. How do you do utilities?

2. More less chance of tenants driving each other crazy than in a duplex?

3. Any tax benifits?

4. Any advice or words of caution would be greatly appreciated.

5. I'm calling this dual living is there another name for this kind of prop

Thank you

[Liam Goble]

In a semi-previous-life (different position at the same company) I used to conduct energy audits on large MF properties. 100% of the time, we found that if Management was paying for heating/cooling, the tenants kept their units at 75+degF in the WINTER and 64degF in the SUMMER. (One unit we surveyed had their t-stat set at 84degF and complained it was too cold).

I do not purchase small MFs that don't have separate utilities for each unit (heating, and electric). I try to find units that also have separate water bills, but that doesn't always happen.

If I am faced with a good deal on a property that has one central system, I subtract the cost to install separate systems into my offer (usually discounted slightly, ie: if cost were to be $12,000, I would subtract $10,000, assuming my savings would be $2,000 for the year).