Lesson Learned with almost first purchased

[BJ Butler]

Lesson learned: Found what appeared to be a duplex by driving around looking for something else. Researched the property and it was for sale. Listed price, $53k. I ran comps for the area. SFH's were selling for $110K & higher in that area. The nearest duplex was too far away but still had a high resale value. The median for rents were about $900-$1000 for a 2bedroom. I estimated $20k in repairs and had a GC who I hoped would give me more of a better estimate since he has a lot more experience than I do. I called up hard money lenders & was told no since I had no experience or they didn't deal w/ duplexes. I wanted to buy & hold this place. I ended up finding a seasoned partner. He examined the place w/ me and determined it would cost about $40k to fix the place (foundation damage & other things) and I was able to get the purchase price down to $48k. He suggested I walk away from it and so I did. The house was selling as-is. Thank God I did have in my contract purchase agreement would be based upon me being approved for a loan and I was not.

Lesson learned: 1) I had an exit strategy. 2) Make sure the GC has experience w/ estimates and not just experience w/ their hourly cost. 3) It benefitted me attending more than one local REIA association. 4) The experience was priceless.