BPOs on 2-4 Unit Multi-Family Properties
Small multi-family properties sell on income as well as bricks. Here is how to value them on a BPO.
Every so often a BPO order lands on a duplex, triplex or fourplex. These properties attract both owner-occupants and investors, which makes them a little different to value than a single-family home.
Confirm the unit count
Count meters, mailboxes and entrances from the street. Public records sometimes list a property as single-family when it has been converted, or the reverse. Report what you observe and note any mismatch with the order details.
Use like-for-like comps
Compare duplexes with duplexes and fourplexes with fourplexes. A single-family sale is rarely a good comp for a multi-unit building, even on the same street. If you have to widen your search area or time frame to find enough sales, explain that in your comments.
Consider the income side
Buyers of small multi-family buildings often look at rents. If the vendor's form asks for rental information, use what you can reasonably find from local listings and your own market knowledge, and say where it came from. Do not invent rent figures.
Note condition unit by unit
- Is one unit visibly vacant or boarded?
- Are there separate entrances, decks or parking for each unit?
- Does the exterior show deferred maintenance that would worry an investor?
Expect a different buyer pool
Investor demand can rise and fall faster than owner-occupant demand. If small multi-family listings in the area are sitting longer than single-family homes, reflect that in your marketing time.
Photos that help the reviewer
Besides the standard front and street views, photograph each visible entrance, the meters or mailboxes that confirm the unit count, and any shared parking or yard areas. If units differ noticeably, such as one with a new porch and one with peeling paint, capture both. A reviewer who has never seen the building should be able to understand its layout from your photos and a short comment.
Write a clear summary
Close your comments with one or two sentences covering unit count, apparent occupancy, condition and the comps you relied on. That summary is often what the client reads first.
Related: BPO adjustments explained.