Deal Analysis – Cap Hill Multi Unit Nomad

The Buyer was looking for a multi family property in the $700-800K range.  He wanted it to be close to downtown with 3+ bedrooms per unit for a house hack.

I worked with this investor to find this Denver investment property, and he closed on it Q3 – 2020.

Investor Profile

• First Time Investor
• Looking for a multi family to rent out one unit and live in the other

Deal Quadrant: MLS

Read about the deal quadrant and finding Denver Investment Properties.

Investment Property Details

• Type: Duplex
• Unit 1 = 4 bedroom, 1 bathroom
• Unit 2 = 3 bedroom, 1 bathroom
• Location: Cap Hill, close to capital building and Molly Brown House
• List Price: $750,000
• Purchase Price: $740,000
• Why we liked it:
  • Great location
  • Multiple bedrooms
  • In the Buyer’s price range

Property Contract Details

• Finding the property: Found out the seller also had the duplex next door under contract to sell and was wanting to sell both sides.
• Under contract:  Below ask and secret sauce
• Inspection Concerns:
  • Issues getting the sewer scoped. Because of all the turns in the line, we couldn’t get to the alley.
  • Other minor issues
• Inspection negotiation outcome:
  • After two attempts we had the Seller pay for the 3rd scope, and they were able to get a good video.
  • Split other costs with Seller in resolution

Property Financing Details

• Lender: Conventional
• Loan Type: 20% down conventional
• Appraisal: over asking, no issues.
• Seller Concessions: $2,500
• PMI: N/A
• Interest Rate Buy Down?: No

Spreadsheet Rental Analysis

Property Operating Expenses

First Year Returns

Conclusion

This was a good deal. The Buyer is living in one side and renting the bedrooms on the other side.

The Buyer, Vasily, was a guest on a previous podcast, House Hack Mastermind #3. Check it out to learn how he and the other guest house hackers got started and what issues they face as house hackers in Denver.

If you want to see more multi family Deal Analyses, check our other multi family Deal Analyses in the Denver area.

Learn about house hacking in Denver with our Ultimate Guide to Denver House Hacking.