Duplex or 4-plex? An analysis from a noob.

[Zach Bagby]

I currently pay 1350 in rent for a 1br 1ba in the South Denver area. I am looking for something to buy sometime next year, maybe sooner if the right opportunity came up. Mainly looking in the Littleton and Englewood areas of Denver Colorado but open to look a little further out if need be. This post is mainly for practice and feedback. My lease is up in April 2018. If you were me would you buy a Duplex or 4-plex? I want to house-hack. Let's make some assumptions before beginning: rents are at 1500 per unit, no immediate repairs are needed, and seller will pay closing costs. (This just makes things easier for a noob like me)

Let's start with a duplex:

(i'm using trulia calculator)

Cost $350,000

Downpayment = $17,500 (5% down)

Principal & interest=($1,549)

Property taxes=($158)

Home insurance=($75) Mortgage insurance=($211)

Total PITI = $1,993

Vacancy = $200

Repairs = $150

Cap Ex = $ 150

Prop manage = 300

Total monthly expenses = $2,493 w/o PM and $2,793 w/ PM.

Total monthly Income = $3,000

Monthly cash flow = $507 w/o PM and 207 w/ PM

Cash on Cash = 507*12 / 17,500 = 34%

That seems too high like I'm doing something wrong any suggestions? I would most likely be paying more than just a down payment but this makes things easier.

Rough Avg principle paid per month = $500 which makes my ROI almost double 34% or 68%.

I would be living in one side which gives me -1500, but it reduces my monthly rent payments from 1350 to 1000 and I get to practice being a landlord.

Now a 4-plex:

Cost $750,000

Downpayment = $38,750 (5%)

Principal & interest=($3,396)

Property taxes=($423)

Home insurance=($75)

Mortgage insurance=($450) Total PITI = $4,344

Vacancy = $400

Repairs = $300

Cap Ex = $ 300

Prop manage = $600

Total monthly expenses = $5,344 w/o PM and $5,944 w/ PM.

Total monthly Income = $6,000

Monthly cash flow = $656 w/o PM and $56 w/ PM

Cash on Cash = $656*12 / 38,750 = 20%

Rough Avg principle paid first year = $13,000 

ROI = 53%

In this case when I -1500 for myself living in one of the units I'm only having to pay $844 a month which is even better.

Assuming I can actually find deals like this (or maybe better) and have the downpayment... What would you do? Duplex? Triplex? 4-plex? Live in flip? How do you analyze deals? Are my calculations Waaaay off? If these are bad deals, why? At what price do they become good deals? Are you seeing any deals like this now? Thanks in advance! =)