[Calc Review] Help me analyze this 4-Plex

[Kassandra Ortega]

Hey, BP community! This is my first forum post and I'm very excited about it! :)

My partner and I are looking into purchasing our first House Hack. A 4-Plex popped up for sale in a C-Class neighborhood. Only looking at the outside (and not taking a look inside yet), it looks like this might be a home run. But I want to make sure we're not missing something. 

My only hesitancy would be the fact that the property is not entirely vacant. 3 of the 4 units are rented out and we would prefer to do our own screening (but maybe that's a separate conversation). What do you all think?

PS: The extra $50/month would be from coin-operated laundry facilities.

View report

Thank you all in advance for your input!

[David de Luna]

Don't automatically assume you must start with a clean slate - all units vacant. Ask questions of seller on current tenants. Long term, paying on time, rarely call them with problems? That would be a golden tenant and even if they are way below market rent, do the numbers - you'll see that evicting them just to get the rent to market rates immediately could result in a long enough vacancy while you clean up the units, with the resultant lack of cash flow, that you were better off raising the rent a hundred or so a year (example) for 3 years (example) on the existing tenant, and then who knows what kind of tenant their replacement will be. An existing, paying, non-complaining tenant is worth their weight in gold. My 2 cents.