Which would you choose?

[Daniel Klebba]

Quick scenario analysis: Given these two options, which would you go for first assuming you have the ability to act on one right away. Option 1: Fully rented duplex listed for $75k in a good school district. Total monthly rent is $1300 and the cash flow would be about $300/month total. The units are in decent rentable condition but could use some updating. Cash out of pocket is $15k down and the property will probably need about $2000-$3000 in repairs. Option 2: A foreclosed SFR in a great school district listed for $65k. Two bedroom one bath. The house needs a good amount of work probably $8,000. When rented we could probably get $1100/month with a cash flow of about $460/month. A comparable home sold in the same area for $45k not long ago. Cash out of pocket would be around $18k. My debate is with the same out of pocket expense do I go for the guaranteed cash flow in the duplex or roll the dice, fix up the forclosure to get a higher cash flow and have a better chance at an increased home value? Both investments I'd plan to buy and hold. Thanks, Dan

[Stavros B.]

Originally posted by @Daniel Klebba:

I don't think it would go up substantially. The area that it is located in there are a lot of rental duplexes so competition is fierce.

 Hey Daniel, great to stumble on another active South Lyon based investor on the forums. Would love to get together and talk shop sometime if you also have interest. Would definitely need to find a different place to meetup than the hotel since the big fire....