My question is about the new deal in front of me--My girlfriend (age 63) has a good friend/long time next door neighbor who says they will sell her their 3 bed/1 bath/1 garage house for "what they have into it", about $40K. 

The house(located in Houston, TX) is 2600 square feet with 4 bedrooms and 2.5 baths.

I've been looking to buy an STR in the OC market since the beginning of the year.  3 beds, at least 2 baths, built in the 2000's with an elevator and pool, downtown or farther up, ocean block preferred, budget 400-450K.

I am confirming you know this has a shared kitchen and bath among x residents and  that is not a deal breaker for you before scheduling an appointment to see. 

Makes it difficult to get accurate value because of small sample size.Some infoLocation, affluent west shore suburb of Harrisburg, low crime,  family oriented neighborhoodRanch style, 2400 Square Feet total, everything updated by hvac system (works fine)Each unit has 2 bed 1.5 bath, one is 1400 sq other is 1000Rent is 1450 one side, 1500 the other, renters pay all utilitiesInsurance, maintenance, and yard upkeep total 3000 a yearGood renter clientele, most are doctors or nurses, close local hospitalsBoth have separate driveway and yard  Located in well of neighboorhood in low tax hampden township, taxes are 3500 a yearThe duplex was grandfathered, out of the 400+ houses in the  development, there are only 5 multifamilies. 4 houses down the street sold for between 380-400k in the last 4 months.

The property that I'm underwriting is going through $70/unit each month on unit mix of mostly 2br/1 bath, which is already ridiculously high.

Investors have renovated a lot of SFRs and improved the condition of the housing stock but the higher rents are putting people out on the streets. 

Going rent for the side my father would live in (2 bed, 1 bath) is about $900-$1100, and the other side (3 bed, 2 bath) could go for $1300-$1700 per month. 

He built a garage with a 2 bedroom/1 bath apartment above it and was able to pay both loans with the Cashflow.

If it's not a good investment property the numbers will tell you.Jaron,We brought the present home in 2012 as our first home.Its a new construction.I did run the numbers on the existing home.As I mentioned we paid 212k in 2012.Took an FHA and refinanced to conventional a few yrs later.(3.5% for 30 yrs Balance on mortgage 160k).Mortgage runs to 1200/month.Our property can be rented out as is for 2000/month.Its a 4 bed 3 bath and rents in our community start with 2000 range for our sq footage.I want to pay off this house asap in next 5-6 yrs and free up money to invest in another house.The houses in our community are in 450k+ range.Hubby is preapproved is not the reason for another house.The other house is right opposite to our community  and is a 5 min walk from our house.So its not a big move.Except that I want to move closer to our kids friends.Our lender metioned Heloc maybe a good choice for further investments.I want to explore Home Equity Loan route to be safer.I am still a layman in Heloc route and dont want to burn fingers.Any advice.P.S.What is COC?