Side by Side duplex in Batavia NY.

[Carl Simon]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $160,000
Cash invested: $50,000

A side-by-side duplex in Batavia, NY. Very well maintained house with a new roof, but with some needed updates to modernize it. The previous owners had rented it as basically a shell. I wanted to add value by offering a higher quality product for renters willing to pay a higher rent as well.

What made you interested in investing in this type of deal?

The layout of the side-by-side, meaning you don't have noise above or below you and can use financing for basically 2 houses in 1. Utilities were already fully split. The location is also in a good part of town next to a major employer in a hospital and near parks and schools.

How did you find this deal and how did you negotiate it?

This was a negotiation that took place with the seller over 5-6 months. He is an older Italian-American looking to retire so we had to get to know each other and build trust and respect.

How did you finance this deal?

Conventional financing

How did you add value to the deal?

Modernized the house a bit by making it more attractive to tenants, and not just a shell. I painted some rooms, added appliances, and effectively marketed and screened tenants (in the winter).

What was the outcome?

Rented both sides of the duplex to one family. The mom and younger kids on one side, with the college-aged daughter on the other side as a starter apartment living next door. The total rent was a bit under the total market of renting both sides independently, but I figure it is a lower risk path to avoid any neighbor disputes. Plus, we spoke about taking care of the property with pride.

Lessons learned? Challenges?

Treat sellers with respect, don't over-improve the house in a middle-class neighborhood, and work with rental applicants to find the "win-win".