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We have a friend selling one and they think they have the same audience as a single family. We disagree and we know an investor would be a category of potential buyers. They were also told their price is likely way too high.
The price they are asking is 50% higher than the tax assessed value. Yes that is tax assessed which can vary from the asking/eventual sale price but......
In some places the tax assessed amount has nothing to do with how much a home is appraised for. My father's home is listed at $35K on the tax records and is worth about $100K. His taxes are outrageous, He pays $500 a month for taxes. 15 years of paying taxes is the current home price. The have a system to put in your tax value which is not the home price. It may be different in other places.
As far as the "audience". It can be a person who wants it as an investment to rent out both sides. It can also be a person looking for a family home who wants to rent out the other side to help pay his mortgage. Or it may be a combo of a person who wants it as an investment for now and later wants to live in half of it, or use it as a mother/daughter home in the future.
A realtor will be able to give you some idea as to what the home should be listed at by checking comps in the area.
Many cultures, especially Asian culture, have joint family where adult kids live next to if not in same house as parents. To keep the family together. For many people from my culture, duplex are perfect solution to looking after aging parents, preserve culture value & have independence
A home has not made it to the agent's website though the sign has been in the yard for months. The delay is said to be because of "a contract and tenant discrepancy."
I have some ideas what that could mean. What does it mean to you?
Some families see a duplex as a hybrid condo alternative. I've talked to many families look for condos or duplex homes as a 'second home' to be able to get into a good school district. In that case, they were looking for a lower cost alternative to a SFH.
A duplex has had a sign in the yard since October and yet to be on the agent's website. They say there is a delay because of "a contract and tenant discrepancy."
What are the possible meanings of that?
Finally there has been an update. Each side of the dwelling had it's own address. It was listed back in April under one of the addresses. Before that despite the signs being in the yard the home never made it to the agent's website until April. The explanation was there was some "tenant discrepancy." That must have been resolved when finally it was listed. Then there was only one tenant and now there are two.
That would seem to reduce the number of potential buyers as now they'd have to gently evict two tenants and not one, if they wanted to rent to a different type if tenant.
The seller also was concerned that the house was shown to only 2 people last 6 months and was considering a new agent.
Maybe the price is too high?
Are not there two types of investors:
A. They want to make improvements and flip it.
B. They want to make it a rental.
Those that might fall into category B might have preferred an empty dwelling or at least only one tenant and some of these investors may have lost interest.
After 6 months listed and no buyers they lowered the price by 3.6%.
I'm sure they would go down 10% for a quick sale.
As far as non investors, a family of 4+ would have to put a door into the middle of the brick wall to get from one side to the other. Otherwise the kids on one side and parents on the other have to exit the dwelling to get to the other side. There are two kitchens, two heating units, and two a/c units.
The good are 4 bedrooms and 2 bath.
Only 0.3 acres so not much of a yard for kids.
We think there are only certain type people who would want this dwelling and I do not think an investor would want to have to wait 12-15 years to get back to even.
What type discounts would an investor want? Investors want to make money so if the price asked is $125,000, what price would the seller expect to get from an investor?
Investors are looking for ROI (return on investment) - converting to a one family might not be possible.
What are the rents?
What is the zoning?
Where can you buy a duplex for $125,000?
My guessing was that an investor would never pay that much.
I think the two rents are under $1000 = say $12,000 a year - maybe $2000 for insurance and taxes = $10,000 a year. An investor would have to wait 12.5 years to own them straight out if they forego the rent as monthly income.
We are not sure on the zoning but there is a mobile home on a lot less than 100 feet from the duplex.
A larger house two doors down sold for around 109. Middle income neighborhood I guess.
125 for a duplex is some bargain?
It's basically (2) two bedroom one bath houses. The two bedroom one baths can be bought all over town for less than $62,500 (half of the $125,000)
My guessing was that an investor would never pay that much.
I think the two rents are under $1000 = say $12,000 a year - maybe $2000 for insurance and taxes = $10,000 a year. An investor would have to wait 12.5 years to own them straight out if they forego the rent as monthly income.
We are not sure on the zoning but there is a mobile home on a lot less than 100 feet from the duplex.
A larger house two doors down sold for around 109. Middle income neighborhood I guess.
125 for a duplex is some bargain?
It's basically (2) two bedroom one bath houses. The two bedroom one baths can be bought all over town for less than $62,500 (half of the $125,000)
there are lots of different flavors of investors & they're all market-specific. In my area, you could unload a property pretty easily that cost $125k and produced 1k in gross monthly rents, assuming it wasn't totally thrashed. If you've got $125k in cash, in the bank, you'll collect what, maybe a few dollars per year in interest? So if you can produce even $100 /mo net income, after all expenses + get some tax benefits & have a chance at appreciation, it would appeal to some. In areas where sf homes retail for $60k, investors are probably looking for deals at $30-$40k. If it's truly an "investment", by definition, you don't "need" it, and you generally need some sort of upside to make you write the check. A duplex might appeal more to some investors, just because they have 2 tenants at one location, easier to collect rents, the hvac guy/plumber/painter/roofer/yard guy can do their thing at both properties at the same time. I tried to keep my rentals in the same subdivision for that reason & it sometimes measurably lowered costs - having identical units also is helpful - you know what to expect for costs after doing one unit - i.e., the carpet guy/painter/plumber, etc. can't really jack the cost for one unit, when you had him out to do the same thing at an identical property a month ago.
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