Triplex Lebanon, Oregon

[Tyler Rodgers]

I went and looked at a three unit property in my town yesterday. I would be buying it as a house hack type deal with the intention of moving out and renting the third unit in a couple years.

I've been running numbers, and it seems like a pretty good deal to me, but this would be my first investment property, so I am a little nervous, and hoping for some feedback. Thanks in advance for the help!

The property consists of a tiny, maybe 350 square foot, 1/1 house and a duplex. Each side of the duplex is a 2bed/1ba with its own single car garage. The garages separate the units from each other. Current tenants have all been there between four and ten years.

The house is reported so have some deferred maintenance issues that need addressed, but is not available for viewing until an offer is accepted. From the outside, I can see it needs new paint and exterior doors, but the roof looks good.

On the duplex, the roof and gas furnaces are newer, and the place seems to be in good repair, other than needing paint. I was able to walk through one of the units and meet the tenant yesterday. At least that unit seemed clean and well-kept with no visible issues. He also informed me that the tenants pay their own water, sewer, and garbage.

Okay, for those still with me, on to the numbers!

Asking price $149k

Current rents 450/450/350 or $15k/year

Insurance (per mls listing. I still need to get my own quote) 864 annual

Taxes per mls 3089 annual

I am estimating 10% vacancy or 1500/year.

20% maintenance and capex or 3000/year

I figure that at asking price and current rents, I would be losing about $2600/year if I put 20% down with 5% interest. Where I think it gets interesting is if I offer only $125k and raise the rents to 600/600/450. This is still at the low end of market in this neighborhood I think. With the same percentages for down payment, vacancy and maintenance, I calculate net operating income of $825 and a mortgage of $537, giving me just under $100/door cash flow once I rent the third unit back out.

For those that read this far, thank you, and does this sound like a good deal?