Been reading Mark's stuff for 2+ years & 18 months ago my wife and I bought our first, an 80 year old 2 unit, 3 br upstairs and 2br downstairs. Kind of fell into it, friend of a friend thing, wasn't on the market, had $7k in back taxes and an sick aging owner. Made a deal for $25K, I paid the back taxes and closing costs. Borrowed $45K from my parents for 10 years @ 5% with a 24 month balloon.
Unit 1 is in bad shape but has been rented for 20+ years by the same tenant @ $950 a month oil heat & electricity included. Unit 2 was vacant and needed a new kitchen & bath and general rehab.
Started out by installing a second boiler and separating the heating systems, electric was already on separate meters. Changed the rental agreement for unit 1 to $375 bi-weekly ($812/month) with the tenant paying for all utilities.
(3) 30yd dumpsters later I started the rehab, all new exterior windows, doors, a new kitchen and bathroom. Paint all around, interior & exterior. Got lucky and the place had 3/4" hardwood floors throughout - a quick sanding & poly job and the floors look like new.
After lots of nights & weekends we just rented the second unit for $650 bi-weekly ($1408/month) with tenants paying all utilities. Will rehab unit 1 into a 3br and add a basement single br unit starting in the spring.
I'm finishing work on a refi to pay off the balloon ($38K). Appraisal came in @ $210K, gonna take out the max cash I can and put it towards another property.
Working on a p&s agreement for a 4 unit now - $135K with the seller holding the note with a 24 month balloon - gross rents @ $3500 & costs around $1500 monthly. This one has the room for 2-3 more units - should know more in the next couple weeks.