- Many times the duplex prices are less than the single family homes in the neighborhood.
- You get double the square footage.
- You get assistance from a tenant to offset your mortgage.
- With a substantial down payment, you can cover your costs.
- Live in one unit for 2 years or more. When you sell, take a $250,000/$500,000 tax free deduction and a tax deferred 1031 exchange on the other half
- Tax benefits (call your accountant for details)
- These duplexes are constructed with remarkable workmanship and quality materials
It depends what you are trying to achieve. If you think the tenants’ rental payments are going to cover your expenses, you are wrong. Don’t forget you have a mortgage, taxes, expenses and insurance payments. Whether you are owner/occupier or investor – most likely you will not make a profit every month. However, you do get to take depreciation on the property on your tax return and you can expect to get appreciation over the years. Improve and protect your investment.
This depends on your income, your debt ratios, your credit score and if you will be occupying the property. Rule of thumb – expect to put down 25% of the purchase price or 30% or more if you are not an owner/occupier.
You can do a legal eviction, if you intend on living in one of the units. But, be prepared. Contact the Los Angeles Rent Stabilization Board/Los Angeles Housing Authorities for details.
Contact the Los Angeles Rent Stabilization Board/Los Angeles Housing Authorities for details – the amounts are constantly changing and there are different amounts for qualified tenants.
Typically not for two units, especially if you are going to live in one of the units.
I only compare one duplex against another duplex. The worth is a combination of factors – location, condition, style of the duplex, income derived from the tenants, whether the property will be delivered vacant or with tenants and improvements.
I will meet with a seller and conduct walk through to determine exactly what must be done to prepare your home for sale. There is a section on my website entitled “how to prep your duplex”, that may be very insightful.
Commission varies between 5-6%. The other costs are escrow, title, documentary transfer tax and a 3 1/3% deduction to the Franchise Tax Board (unless you have a loss on the property or are doing a 1031 exchange).
Yes. Remember, you cannot do an exchange on your principal residence – you can do an exchange on 1/2 of the property if you reside in the other half. Contact your accountant or a 1031 exchange accommodator for details.
Los Angeles is unlike any place in the U.S. Our duplex market is not seasonal. I sell duplexes during every month including holidays – my market actually picks up at the end of the year.