Should I Buy These Duplexes? A First Walkthrough

TLDR

MLS deals can work when you show up fast, bring a quick checklist, and do the rent math on the tailgate. On a three-duplex lot asking $800,000, the rent told the story before the inspection did. Here is how I walked it and how I ran the numbers.

Table of Contents

• Why I Took An MLS Listing Seriously
• My Quick Walkthrough Order
• What I Check Inside
• What I Check Outside
• The Quick Rent Math
• FAQ
• Related

Why I Took An MLS Listing Seriously

I almost never buy off the mls. You are competing with every other buyer in town, and the price is usually already bid up. But there are three ways on-market deals still work:

1. Speed. You are the first offer and the seller has not shopped it around.
2. A longer hold thesis. The deal is not in the money today but will be in a few years.
3. Heavy work. The property is ugly enough that most buyers pass.

This one was speed. The three duplexes came on the market on a Saturday evening. I caught the email, saw the rent-to-price ratio, and knew most investors were off the clock for the weekend. If the seller had waited for Monday, there would have been ten offers. I wanted one offer in before they woke up.

MLS deals work when your speed is your edge. Be ready to move in hours, not days.

My Quick Walkthrough Order

Once we were under contract, I set up the walkthrough during the inspection period. I do not try to inspect the house. The inspector does that. My walkthrough is about rent, layout, and anything that would change my offer.

Here is my order:

1. Walk the outside first to see the envelope of the building
2. Step into vacant units so I can move fast
3. Peek into occupied units to verify layout, not disturb the tenants
4. Back outside to look at drainage and site work
5. Tailgate math before I leave

On three duplexes in 45 minutes, that order kept me moving.

What I Check Inside

I am looking for three things: rent potential, any obvious red flag the inspector might miss, and layout surprises that change my number.

On rent potential, I ask the current owner what they are getting and what they think they could get. Here is the simple version of what that sounded like for me:

The middle-unit conversion was the alpha move. Wasted space by the entry could be closed off to make a second bedroom. Two-bed rents higher than one-bed, every time. That is forced appreciation without touching a mechanical.

Inside, here is my scan list:

• Ceiling height. I look above every door. A door is 7 feet. If there is a foot of wall above it, you have 8-foot ceilings. Less than that, watch for 7-foot rooms that hurt rent.
• Water smell or stains. If I smell it, the inspector will find it. If I do not smell it and there are no stains, I move on.
• Floor slope. I walk corners. If a floor is drifting, a foundation question just entered the chat.
• Tub surrounds versus tile jobs. Solid surround is a feature in a neighborhood like this. Bad tile lets water behind the wall and costs you two years later.
• Fresh paint. White on white spray is common. If you are not matching a trim color to the walls, you save real money on turnover.

Pro Tip

Always look above every door. I have walked into rooms and not noticed a 7-foot ceiling. Low ceilings tank rent more than any finish.

What I Check Outside

Outside, I am looking for the story the building is telling me. Curb cuts, added concrete, sewer cleanouts on weird walls. All of that is evidence of past problems somebody tried to solve.

On this lot I saw:

• A curb added later along one side, which told me somebody had a drainage issue there
• A sewer cleanout coming up on the front instead of the back, which was odd but not a deal breaker
• A drainage pit with no good way out, also odd
• No cracks in brick, no signs of active water damage

None of it was worth killing the deal. All of it is worth flagging for the inspector to chase.

Common Mistake

New investors walk a property looking for things to love. Experienced investors walk looking for evidence of things that went wrong before. The second mindset saves real money.

The Quick Rent Math

Here is what I ran on the tailgate:

A high 7 cap rate on a turnkey deal, no work needed, is a buy in most markets. That math told me to close. The inspection was the second vote.

I still felt like I was missing something because this is not the kind of deal you normally get on the MLS. Which is why I did the walkthrough slow enough to spot anything. If the inspector comes back clean, I am a buyer.

The deal is the rent versus the price. Everything else is noise until the math breaks.

FAQ

How long should a first walkthrough take?

30 to 60 minutes for a small multifamily. Any longer and you are trying to do the inspector’s job. Any shorter and you missed something.

What if units are occupied and I cannot get in?

Peek into the doorway with the tenant’s permission and respect their space. You are not inspecting. You are confirming the layout matches what the owner said. If the owner will not give you access to any unit, that is a red flag.

What cap rate should I target on small multifamily?

In most secondary markets, an 8 cap on stabilized rent is strong. 7 can work with strong appreciation markets. Below 6 you are buying the story, not the numbers.

What is the fastest way to raise rent on a property like this?

Convert under-utilized rooms into bedrooms when layouts allow it. A second bedroom in a unit that was a one-bed usually justifies $200 to $300 more per month in most Class B and C neighborhoods.

I am new. Should I buy small multifamily as my first deal?

Single-family is easier for most new investors because financing is simpler and turnovers are less complex. Small multifamily works if you have a property management relationship lined up and reserves for multiple units.