I have an opportunity to add an ADU to a duplex I own that would return about 12.5% CoC and increase my pure cash flow on that property by $800/month when completed but I’m not convinced that’s the best move.

The following post is purely to show that I have learned a lot on my first ground-up home build and partnership, or really lack there of.

We moved office locations from a single-family house in the suburbs of Martinez, GA to an iconic building on 1918 Central Avenue, a former Pure Oil gas station designed to look like an English Tudor cottage.

The best way to approach this is from purely a business and service standpoint; I'll say it again from a service standpoint - Owners will want to approach it as a 'partnership' whereas if they have issues, then you have issues and you share the responsibility of their dilapidated property or their ill performed decisions with them BUT at the same time some will want to nickel and dime you at every turn, in an industry that operates on nickels and dimes.... so my advice is for you to approach it from purely a service standpoint, no different than that from a landscaper, or plumber, etc.

Is this a property you would have bought as a pure investment?

This is especially true given the high price I expect to pay for the property, as I think appreciation will give me the best ROI.I prefer house-hacking to out-of-state because:1) I want to own the house I live inThis is a pure emotional thing.

@Jane Mipsey putting the investment property in an LLC is purely for limiting your personal liability, not for tax purposes.

This January 29th to February 1st, join thousands of BiggerPockets members for four mind-blowing nights of pure real estate wisdom led by your favorite real estate experts and make 2024 your year for real estate success! 

Purely cost and governmental.  

It’s a purely a balcony.