A promising duplex can become a costly mistake when the hidden risks go un-investigated. Missing permits, aging systems, and environmental concerns don't disappear after closing. They become the buyer's problem. Before making an offer on any investment property, understand the full picture. Run a PropertyLens report at PropertyLens.com and make decisions based on data, not hope.

In this episode of Property of the Week, hosts Bob Frady and John Siegman evaluate a Cincinnati duplex located in a desirable neighborhood with a tenant already in place and strong rental potential. On the surface it checks the right boxes for investors. But the PropertyLens report uncovers several yellow flags that buyers shouldn't ignore, including missing permits, aging systems, environmental risks, and an unusual ownership history. This episode is a reminder that even a promising investment property deserves careful due diligence before making an offer. A good investment isn't just about rental income. It's about knowing the hidden costs.

The property has no recorded building permits, including for visible renovations.

Aging systems could require major repairs that affect cash flow and returns.

Radon exposure and nearby contamination sites warrant environmental testing.

Replacement cost exceeds the purchase price, creating potential insurance exposure.

Ownership history raises questions buyers should investigate before closing.

A tenant in place is a positive, but rental income doesn't replace due diligence.

Yellow flags are worth investigating before closing, not after.

The Paper Trail That Protects Your Investment: What Buyers Need to Know About Unpermitted Work

The missing permits Bob and John flagged on this Cincinnati duplex are exactly the issue explored in this PropertyLens article, which breaks down how unpermitted work transfers legal and financial liability directly to the buyer at closing, creating insurance gaps, city enforcement risk, and costly problems at resale.

Episode 50 | How We Found YELLOW Flags in This AMAZING Duplex

[00:00:00] :This week on Property of the Week with PropertyLens, we travel to Cincinnati, Ohio to take [00:00:05] a look at a potential investment property. Is it a money pit? Is it a great house? Stay tuned and [00:00:10] find out[00:00:15] [00:00:20] 

Ladies and gentlemen, boys and girls, ships at sea, it [00:00:25] is time For this week's episode of Property of the Week from PropertyLens. [00:00:30] For those of you who don't know, my name, Bob Frady, CEO and [00:00:35] co-founder of PropertyLens. With me as always ... 



John Siegman, president and co-founder of [00:00:40] PropertyLens. 



So normally I go in and pick a property, but John, this week you [00:00:45] have picked the property.

I did. What property d- did you pick, and why? 



[00:00:50] I picked a property in a lovely neighborhood in Cincinnati. For those of you [00:00:55] who don't know, our CTO, Josh, lives in Cincinnati, and [00:01:00] Bob and I make his life miserable. Not intentionally, but we do make his life [00:01:05] miserable just about every day with different questions that we ask, wanting different things.

And [00:01:10] I thought to myself, "What would be the only way we could make Josh's life more miserable?" [00:01:15] Move in next door. 

So I looked for houses [00:01:20] in Josh's neighborhood. 



And it looks like you have picked out [00:01:25] 2786 Markbreit Avenue in Cincinnati, Ohio. It is a [00:01:30] duplex, three bedrooms, two bathrooms, 1,800 square feet.

[00:01:35] Let's go see the report. 



 Well, you know, it is Ohio. There's lots of stuff to be affected, but [00:01:40] what a nice neighborhood. Safe place score of an A. Property score C, probably needs a [00:01:45] little work. 



Yeah, you don't normally see, a safe place score of an [00:01:50] A, which is great when we do see it. And when we look at the property [00:01:55] score, what's dragging the score down?



 the financials and the aging systems. [00:02:00] 



 Yep. Yep. What's the snapshot telling us here, John? 



 It's had four owners in the last 15 years, which raises to me a little flag. [00:02:10] Houses typically don't turn over every three, four years type of thing. It's a little bit [00:02:15] slower than that typically.

It's not a flip, so you're not walking into, you know, somebody [00:02:20] buying it and trying to make money off of it and maybe not doing the things that they should to the way that [00:02:25] they should. No known building permits. I think the big one here is insurance has [00:02:30] stayed, you know, fairly flat. You're gonna be walking into 10% of the cost of the [00:02:35] house in repair costs in the next couple of years.



Yep. When I look at this, I see two yellow [00:02:40] flags. Number one is no building permits. Is there any work that's reported to have been done, [00:02:45] because permits are required in Cincinnati. And the second is the repair costs. [00:02:50] So this is a 108-year-old house. Obviously, not all the systems are 108 years old, [00:02:55] but it looks like we're running up against the useful life of many things.

But we'll see. Our [00:03:00] highlights. Oh, it says it's an updated kitchen. Completely remodeled kitchen with modern finishes. Well, that's [00:03:05] interesting since there's no permits. The roof looks good, and it's a turnkey investment. There's a duplex with a [00:03:10] tenant in place until spring 2027, which is nice, so you'll have at least some rental revenue for a [00:03:15] little while, maybe even longer.

Some of the concerns, aging systems probably in need of [00:03:20] replacement. There's high pollution, and it's near a contamination site, and there is a [00:03:25] radon risk here. So you wanna make sure that you're asking, "Has, has it been inspected for [00:03:30] radon?" Our estimated repair costs $42,000 Insurance cost [00:03:35] $1,700, not too bad.

Okay, the big five questions. What are you seeing here, John? 



 It looks like it does have a [00:03:40] basement the way it's sited in the picture. Cincinnati is moderate for termites. They [00:03:45] will travel through mud tunnels, and it's 108 years old. That is well-aged wood. That is [00:03:50] very tasty to those bugs. You want to check for water and mold damage in the basement, [00:03:55] foundation condition.

Lots of foundations, even at 108 years, are [00:04:00] perfectly fine, 

but that is something that you definitely want to have inspected. [00:04:05] And then any resolved issues 

from the roof's most recent hail damage. So the roof [00:04:10] is in great condition, and so it may have been replaced recently due to [00:04:15] that hail damage. 



I've been on a bunch of real estate tours, and none of them [00:04:20] talk about these issues.

So this is exactly why we surface them in [00:04:25] PropertyLens is because nobody's talking about this stuff, but you have to live with this stuff once you move in. 



You mean [00:04:30] that the people that are pushing sales on a real estate tour don't talk about anything [00:04:35] negative associated with the property, Bob? 



 I think you're [00:04:40] onto something there, John Siegman.



So when we look at our buyer lens and our projected [00:04:45] two-year repair expenses, you know, most of these systems are [00:04:50] past their useful lifespan, at least according to the data that we [00:04:55] have. You know, there may be, has some work been done, but there is no signal to tell [00:05:00] us otherwise, you know, the listing or the permit data.



 And the [00:05:05] listing talked about the new kitchen. 



 So you know that if any of this other stuff was [00:05:10] new, it had been talked about. 



 Yep. So here's what we're seeing. We've got a 108-year-old property. [00:05:15] No systems have been updated, and lots and lots of data. High turnover can be a sign of bad [00:05:20] neighbors, bad noise, or other issues with property surrounding area.

It's not because our CTO lives down the street. [00:05:25] 



 No. It's not, that's not Josh's fault. I just want- 



 Yes. The... [00:05:30] All of this is just check the age of the systems because you're gonna be spending some money. [00:05:35] You've got some risk of toxic exposure, which is radon. You gotta ask, has there been a radon [00:05:40] test at this area?

Because there's no indication that there has been a system. You've got soil issues [00:05:45] here, and you get some runoff. You just want to be careful, especially when you have bad soils. [00:05:50] They attack foundations. So when you have soils that run off, you always want to check [00:05:55] the condition of either the crawl space or of the basement itself, and [00:06:00] this one has a basement.

So I did a property a couple of weeks ago for a friend of mine. It's built on a crawl [00:06:05] space. I'm like, "Dude, you got some soil issues there. You better have that inspected." And they did, and it was a [00:06:10] $75,000 repair, to fix the issues with the underlying, [00:06:15] footings on the house. So you gotta make sure you know what the soil conditions are like in that area.

[00:06:20] And from an insurance standpoint, pretty straightforward. One thing, though, is the replacement cost is [00:06:25] higher than the ask it cost. So this would cost more to replace than it would be to build 



 And that is [00:06:30] true of 70% of the housing in the US 



If you insure [00:06:35] up to the value of the property, you're gonna be close, but that is still a [00:06:40] gap of $25,000 - $35,000.

Let's take a look at the listing that you're so [00:06:45] desirous of. We should just buy this just to aggravate Josh. It's a duplex. First floor [00:06:50] unit, one bedroom, one bath, a completely remodeled kitchen with modern finishes. You could also [00:06:55] make that a rental. Upstairs is two bedrooms and one bath and has a tenant.

Or whether you just wanna make this [00:07:00] an investment portfolio, you can do these things. And it's in a desirable neighborhood 'cause it [00:07:05] says it a several times. 



I'm still thrown [00:07:10] by the fact that it says the kitchen has been renovated, but there's no [00:07:15] permits. So maybe it's just a cosmetic renovation where they, you know, did some, maybe [00:07:20] the floors and maybe the cabinets and didn't change any of the systems.

But if they [00:07:25] did make electrical changes, it's not permitted, and you gotta wonder about that. So when we look [00:07:30] at the ownership, this has been interesting. It was sold in 2013. Somebody got married, [00:07:35] put his wife's name on the, on the deed. They listed it in December, sold in [00:07:40] January for $302,000. It's lovely.

But then it went to a [00:07:45] beneficiary creditor, and usually that's when somebody, [00:07:50] one of the two passes away. And then it was sent over to an [00:07:55] LLC, which is another flag to say, [00:08:00] "Why- what's with the ownership on this place?" And was this bought by [00:08:05] an LLC, or was it just reclassified as an LLC, or what's the deal with the deed?

And [00:08:10] Sean, why do you wanna make sure that the deed is [00:08:15] clear when you buy a house? 



 Well, because all sorts of bad things [00:08:20] happen when they're not. 



[00:08:25] Well, you could have other creditors or unknown creditors that come back to haunt you, [00:08:30] questionable ownership. It just raises a bunch of hassles that you don't need to go through.[00:08:35] 



 This may slow down getting title insurance, or it may make title insurance more expensive, [00:08:40] but it's a factor that you wanna be aware of, when looking at [00:08:45] title insurance for this location. You want to make sure you have it. This is the kind of thing that you want to be careful of when [00:08:50] you're buying a property, especially if it's a rental property.

Here's the taxes. Property's been reassessed, it [00:08:55] looks like, every three or so Let's see. It was reassessed in 2017, and it was [00:09:00] reassessed in 2020. Yeah, it was $6,500 in [00:09:05] 2025. It's actually come down a bit, since 2020, the [00:09:10] taxes on that location, which is interesting, but it's way above where it was 10 years ago in [00:09:15] 2015.

So you wanna figure out what's going on from a tax standpoint at this location. Here's the [00:09:20] pictures. Oh, it's looks lovely. 



 There's that redone kitchen 

Here's the cosmetics in the kitchen. [00:09:30] 



 And, gosh, it [00:09:35] looks nice. And you got a basement and washer [00:09:40] dryer. Lovely neighborhood.

There's the plans. no [00:09:45] catastrophic events, at this location. If you look at the roof, [00:09:50] looks pretty good.[00:09:55] 

Any events in the past Nope. [00:10:00] Everything looks pretty straightforward. That roof changed color at some point. [00:10:05] Well, he got better light on it, it looks like. 2016. Different [00:10:10] cars on the street too.

Roof condition [00:10:15] looks pretty good. Looks like it was replaced about 10 years ago, so it's got 20 [00:10:20] years left on its life. You still wanna check, and it looks like it's in good condition. Doesn't [00:10:25] have any big ponding or issues with it. A little bit of [00:10:30] staining, but that's not that bad. So the roof looks like it's in pretty good shape.



 Yep. One [00:10:35] less thing to worry about. 



There's your soil runoff, which we talked about before. Water hardness, you know, do [00:10:40] you have a water softening system at the property? and luckily, very low risk [00:10:45] of mine subsidence, because it is Ohio, and there are a lot of mines that are hanging around [00:10:50] making people unhappy.

Here's the red flag, no [00:10:55] permits. Look at that, not a flood zone to be seen. Nope. So you're not gonna need flood [00:11:00] insurance. It's not recommended. I mean, you could if you really wanted to, but [00:11:05] we don't recommend it. All right, from a climate standpoint- 



 Warm in the summer, but it is [00:11:10] relatively... It's just, it's Cincinnati.

You got some [00:11:15] tornadoes. 



 Should the New Madrid fault go, you probably will feel that. But [00:11:20] otherwise, you got really nothing to talk about here. 



Pretty straightforward. The [00:11:25] crime risk is moderate in this area, so [00:11:30] it's a C, little bit of larceny. You know, you, that, which is people taking [00:11:35] stuff from your...

Which you don't like. But it's, you know, America's a pretty safe place. [00:11:40] This is relatively straightforward. Oh, there is a sex offender right down the street. 



And [00:11:45] that's not Josh. Josh lives over on Ballard Ave, which [00:11:50] is just outside that circle- 



There it [00:11:55] is right over there. Could make this our office in Cincinnati.

Couple of sex offenders, one's [00:12:00] pretty close by. Not a lot of public transit. Relatively okay from a walking [00:12:05] standpoint. Not a lot of noise. 



The PropertyLens report surfaces a pattern that experienced investors know to take seriously. The property has no recorded building permits, including for a remodeled kitchen that would typically require them. Aging systems point to near-term repair costs that could quickly erode rental income projections. Radon exposure risk and nearby contamination sites warrant additional environmental testing before closing. The ownership history raises questions that deserve answers before any offer is made. And replacement cost exceeds the purchase price, meaning an underinsured investor could face a significant gap in the event of a major loss. The tenant in place provides immediate income, but rental income doesn't eliminate the need for thorough due diligence.

How We Found YELLOW Flags in This AMAZING Duplex

Know what you're buying