Duplex in Minneapolis - Is this a good first deal, possible owner-occupancy???

[Sam Hodgett]

Okay, my wife and I are ready to start looking for our first deal. Our intention is to purchase a 2-4 unit home and live in one of the units, thus taking advantage of FHA/203K financing.

I cam across a HomePath duplex property that looks very promising.  I'm not very familiar with HomePath, and I haven't had the chance to check this property out in person... but similar duplexes in this area can go for much more than what this property is listed for.

Here are the numbers:

• Listed price: $105,800
• ARV: I have no idea... but if the right repairs are done to it, it could easily be $175-200 in value
• Estimated repair costs: Knowing it's foreclosed, and listed as "requires extensive repairs," I am putting them at $50,000. Again... that's a big guess on my part, as I haven't seen the property yet. (NOTE: It was stated as previously a SFH, so would probably have to be re-converted to a duplex).
• I estimated monthly expenses (including 10% vacancy/capex/repairs as well as PITI) around $1500 or so.
• Potential income (if both rented) could be around $1800-2000, of course half of that if we lived in one unit.

Okay, what are your thoughts? Am I looking at this right considering its HomePath? What should I be looking for when I take a look at the place? Based on my numbers, if both rented out, I could be easily getting a CoC of double digits...

Any feedback appreciated!  I'll answer any questions.  Thanks!

[Bob E.]

Check and see what the house is zoned for.  You don't want to buy and then find out it is illegal as a duplex.

As an FYI if you wind up doing cabinets check out Building Material Outlet they have a location in Minneapolis they were Waaaay less then Home Depot here in phoenix, less then half the price and carried a lot of cabinets in stock here at their Phoenix location.

BMO