Renovated with cosmetic updates for immediate rental income, it offers strong cash flow while preparing for more extensive repairs and the addition of an ADU.

The trifecta is making the owner and property manager happy, compensating for the extra risk, issues, and potential repairs, and encouraging the resident to limit the number of pets and be sure they are not damaging the property. 

If the existing ceiling paint is damaged, the ceiling must be scraped, repaired and painted.

Overall, it can be a profitable business, but most people get into it to become an investor and 99 percent fail right away because they don't know the slightest thing about repair costs, talking to sellers, and are only in it for the money and not to help people.

Your first concerns should be your operating procedures and insurance.  

Keep in mind you need to account for soft-expenses as well such as Vacancy/Turnover, Maintenance/Repair, and Capital Expenses.

In 2020 I bought my first house 3 bedroom 1 bathroom and a 2 car detached garage for $175,000 and put a 10k downpayment on it and interest rate was 3.5%, in 2023 I decided to rent it out for $1350 mortage was $1106.62, in 2024 we raised the rent to $1450 and our mortage currently is $1144.76- I never put into account repair expenses, Capex, vacency until I read on rental investment properies book.

While currently unrented, the duplex may serve as temporary housing for tenants from a nearby commercial property I also own, which requires repairs.

If they are 40-50 years old then potentially it would be more expensive to maintain/repair them.

I added value to the deal by initiating cosmetic repairs to make the units rent-ready while preparing for more extensive renovations.