High risk high reward: confessions from a little landlady.

[Jen Narragon]

It's been almost two years exactly since we bought our 1883 Quadplex in downtown San Luis Obispo and we've learned a ton.  Our next purchase will be very strategic knowing what I know now.   If you're a newer investor looking to purchase,  there are some definite things to consider.  In hindsight, we took on a massive level of risk.  Fortunately, it all worked out in the end but we definitely navigated through rough waters.  Zoning, permits, budget, supply chain, and screening tradesmen, were all areas we were newer to.  This was the fourth property my husband and I had purchased and the third property we renovated.  Although we had experience renovating, a quadplex was a completely different animal than your average single-family dwelling. 

I would say one of the single biggest decisions to make when purchasing a multi-unit is your strategy for the buildout as it relates to budget and cash flow.  I went completely intuitively and fortunately, it worked out well for us.  If you're considering a multi-unit, consider mapping out a detailed plan based on budget, zoning, supply costs, and the level of lipstick on a pig ability the project has so as to be able to pivot if need be.

Our project was a total gut job and the foundation was one of the biggest expenses coming in at nearly $140k alone.  We purchased during the pandemic and there were so many variables that shifted that could have tanked us.  There's no sure proofing a deal but there are things you can be aware of ahead of time that can save your a$$.  Trusted advisors are absolute and a solid risk mitigation plan will go hand in hand.

We did have our budget mapped out before we started the project but there were some unforeseen costs that came up such as the sewer lateral for example.  Now that we're nearing the end of our project finally getting to the unit we live in, our budget has shrunk and we've ended up doing a lot of the work ourselves.  We've been living like campers the whole time because our focus was on getting the property cash-flowing and rented.  

There's a lot of advice I have also on your planning schedule as it relates to how you're going to run your rentals.  Airbnb vs long and short-term rentals are all different animals and each jurisdiction has very different laws.  My initial focus when we moved in was on getting our Airbnb up and running.  Because I procrastinated on address change, I was able to qualify as a host in our city because of logistics.  There were so many unforeseen possibilities for disaster yet we managed to win the karmic lotto and skate through on top.  

As stressful as the past two years have been, I would do it again in a heartbeat and can't wait for the next.  I hands down prefer Airbnb over longer-term rentals for various reasons.  I'll post more on that another day.   All in all, being a female investor is one of the greatest jobs on the planet, I highly recommend it with some caution, awareness, and support.    

[Scott Mac]

You work very well with colors are you a professional decorator?

[Nathan Gesner]

Nice results! Care to share the numbers?

[Janelle K. Eagle]

So incredibly proud of and happy for you to reach this milestone. You certainly have worked harder and longer than most could ever fathom, and have sacrificed so much to achieve this dream! Bravo, friend!!!

[Jen Narragon]

[Scott Mac]

You work very well with colors are you a professional decorator?

[Scott Mac]

You seem comfortable going into the walls and ceiling, have you thought about letting more air and light into the small kitchen?

Something like in the mockup might take an average space and make the unit something special.

SLO is such a pretty town, and your plex already has some pretty upscale pavers for the driveway.

Good Luck!

[Patrick McCandless]

Congrats neighbor!

[Michael Fussell]

Thanks for the share! 

[Jen Narragon]

Quote from @Nathan Gesner:

Nice results! Care to share the numbers?

Hi Nathan!

The purchase price was $1,089,000.00.  We've put an estimated $300k into it.  We've done a lot of the work ourselves which has been a huge savings.

[Jen Narragon]

Quote from @Janelle K. Eagle:

So incredibly proud of and happy for you to reach this milestone. You certainly have worked harder and longer than most could ever fathom, and have sacrificed so much to achieve this dream! Bravo, friend!!!

Thanks for seeing the depth of work, Janelle... #iykyk I can't wait to catch up and see your property!  When can I invite myself over;) 

[Jen Narragon]

Quote from @Scott Mac:

You work very well with colors are you a professional decorator?

 Thank you, Scott.  I've been in RE since 2012 and have always staged my listings and done my own design on all of my personal projects.  I have a huge passion for design which is why I love taking on this massive project, I get to do a lot of shopping and seeing everything come together is incredibly rewarding;)

[Jen Narragon]

Quote from @Scott Mac:

You seem comfortable going into the walls and ceiling, have you thought about letting more air and light into the small kitchen?

Something like in the mockup might take an average space and make the unit something special.

SLO is such a pretty town, and your plex already has some pretty upscale pavers for the driveway.

Good Luck!

 Thank you, Scott!  This plex is pretty complex.  There would be no way to open the studio kitchen because there's an attic that lives above it.  The one-bedroom unit has a crawl space above it also so no opening up there either.  We've certainly become very comfortable getting down to the studs, this place was pretty ratchet.  I love the suggestion, it looks super bright and airy.

[Jen Narragon]

Quote from @Michael Fussell:

Thanks for the share! 

 Thanks for virtually stopping by Michael:) 

[Jen Narragon]

Quote from @Patrick McCandless:

Congrats neighbor!

 Thanks, neighbor! I'll be in Paso on the 17th for my female investor meetup if you know any cool gals who may want to join us, we're going to have a brilliant speaker:)

[Yue Lehman]

What a huge undertaking and I'm sure there's lots of laughs (and maybe tears) along the way. Thank you for sharing and can't wait to see the listings!