Duplex Analysis

[Glenn Willeford]

Long time reader but it is time to get the feet wet. 

Asking $95500 for a duplex that was gutted and rehabbed about three years ago. Everything new except the roof.

Unit 1: 1 Bedroom/1 Bath, rent is a combination of section 8 and tenant for a total of $700.00.

Unit 2: 1 Bedroom/1.5 Bath, rent is a combination of section 8 and tenant for a total of $740.00.

Based on the 50% rule, 20% down, and a 5% mortgage rate, the COC is 14.87% and $155.00 profit per door. Offering $85000 plus closing will have the COC at 25% and $177.00 profit per door.

Also, unit 2 has solar panels and the tenant pays the owner $60.00 extra per month. The contract with the solar panel company, signed last year by the owner, is for monthly payments of $50.00 for 10 years. Not sure how it transfers. In addition, there may be room on the property to add a separate structure for a one bedroom/1 bath unit.

How does this deal look and has anyone had experience with solar panels?