The comps in the area have been all over the place. A similar duplex went for only $33k down the street (which rents for $750/unit). A much smaller SFH went for $41k. The market in this particular area is a bit hard to read in that regard.
As for tenants, it's an off-campus college housing area. I wouldn't expect tenants to stay for more than a 2-3 years in a normal situation. This particular occupancy is a bit different. They almost treat it like a fraternity (it's not). They open up the duplex and treat it like one house. When someone graduates or leaves, they recruit others themselves to keep the rent/occupant low. From what the occupants have told me, they've been doing this (aka no vacancy) as long as anyone can remember.
I plan on paying cash for purchase, then refinancing my cash back out when appropriate. The bank has mentioned "off the record" that it's going to take $40k to get the property. I'm willing to go that high. The income potential, to me, outweighed the other formulas for purchase price. I was just seeing what others here would say/do.
The main fixes are roof (a reputable company is running a special right now for $5k) and a wet basement. My father is a homebuilder and journeyman carpenter. We found the source of the wet basement and it's a very cheap, easy fix (not common with wet basements!). The front porch needs some work, but we can handle it. The wood shingle siding needs repainting. The two smaller furnaces probably need replacing within 5 years. Due to the work involved, I do not plan on taking out ANY of the positive cash flow for the first year to build up a buffer.
