Denver Under Contract on Triplex! Referrals and advise welcome.

[Michael C.]

Sometimes life is crazy with how fast things happen!

Literally looked at our first unit in person, been watching the market/mls for alittle while, this one looked interesting and I like the area so we went and looked at it with listing agent. Owner was present we talked for a bit he liked us. Well now we are under contract for $120k under list price. It needs work and will be a live in BRRRR.

I didn’t have my whole team built yet so looking for some help. 
1. Can anyone recommend a good property inspector for an older home?

2. Anyone local do VA rehab loans? Is that still a thing? Or any other good lenders? Currently started working with first bank.
Trying to explore my options, but the property needs work so I don’t think VA or fha will work. Only rehab, 203k, or conventional (I can put 25% or more down but don’t want to if I don’t have to). 

3. Any other recommendations for a newbie?

[Steve K.]

Zoning code U-RH-3A= U for neighborhood type, Urban. RH for building type, Row House. 3 for max stories (3), and A for square footage (3,000). Row house means all front doors must face the same direction. Tax records list this property as a legal duplex. Getting properties rezoned in Denver, in my experience, is hard. I'd probably keep it as a non-conforming triplex and not bother with the city trying to change the zoning which will likely be a dead end. You'd probably have to show some kind of hardship, provide an as-built, get architects involved etc. It may be grandfathered in or something somehow but you'll want to research that and just know the city very rarely allows zoning alterations except in hardship cases.  

There's an expired listing in the MLS, from a few years ago (listed at $360k), that says it used to be a 4-plex but "previous tenant converted downstairs into a 3 bedroom 2 bath residence". I'd check if any permits were pulled for the work that was done/is currently being done. Being zoned as a duplex but set up as a triplex will potentially cause problems if you want to permit any work, and if you don't permit work that could hurt the resale potential.

As Bill S. said, there really aren't many triplexes in the area, so they're hard to comp. Since it's technically a duplex it should probably be comped against other duplexes, or more specifically I suppose, non-conforming triplexes. From having worked on deals in the area and from owning a building not too far away, I'd say $130-160k per unit is average pricing for multifamily in this location. I have 1/1's nearby rented for $950, 2/1's @ $1,300 and 3/2's @ $1,850 (clean, updated units but nothing fancy). I think your projected rents are possible but a little on the high side. An ARV of $650-700 is overly optimistic IMHO. I'll be curious to see what the appraiser comes up with.

There is a 2.8% commission for a buyer's agent built in to the listing agreement, so the seller was prepared to pay an agent to represent you, just FYI (although the seller is probably saving on not paying one with the current arrangement, and hopefully some of those savings are being passed on to you). The listing agent had a fiduciary duty to the seller as the listing agent, but now as a transaction broker cannot advise either side, which is a bit tricky for them to navigate since they've obviously already coached the seller. Anyway, be sure to do your due diligence, get good title insurance, use a good inspector, do a sewer scope, etc. and verify everything. Keep us posted and good luck!