Hello friends. Been on the forum and have not found a single deal yet because of my very aggressive offers based on 50% and 2% rules. But here in Dallas the market is getting really hot and turning into a seller's market. Does not know if it is going to last or just another bubble.
Anyway a buddy of mine have found four duplexes in a small town outside of Dallas. Below are the details
4 side by side duplexes, asking price of $149,999 each.
Monthly rent of $750 to 800 per unit. Each unit is 3 bed, 2 bath, around 2600 sqft built in 2003
The current owner was the original builder and had listed those back in 2007 for $164K and it expired.
Property tax is $3,400 per year per duplex and insurance at $900 per year
One unit has a tenant from 2009 and now on month to month.
One unit has a lease until 01/2014 and the remaining units the lease is expiring in couple of months. The owner will provide estoppel.
Couple of units are on Housing Choice Voucher, county pays part of the rent, something like section 8.
Since the owner is a builder he does not have any expenses on record. He just provided a spreadsheet of repairs he performed in the past without a cost. I do not believe he never claimed any expenses in his return.
Now the property has been on the market for a while. My friend offered low $130K and the seller is firm on $142K a duplex. I tried explaining it to my friend but he is making an offer soon.
What do you all think, please provide your criticism and I can justify to my friend this is a good deal or not. Also what do you all think the reason the seller has this on sale?
Thanks in advance for the help everyone!