Single family to multi-unit conversion — San Diego 1st investment

[Nathan Vaughan]

Hey there!

I live in Logan Heights neighborhood in San Diego. I’ve been a homeowner since 2013. We got a great deal on an big old home on big lot. I’ve been restoring and remodeling it for about 7 years. Didn’t really have a plan for what to do with it long term. My partner and I have decided we didn’t want to stay in the area and we also didn’t want to have roommates.

The house is worth about 2x what we paid for it, there are some cosmetic things that need to be done and a few unfinished projects. We got excited about buy a new place with a bigger budget - around 800-900k.

After thinking through things and talking to some realtor and architect friends, I ultimately decided that I needed to do some more investigating before we made such a big decision.

Thank god we did!! I found out that we could have an extra unit on our lot. We could also have an ADU and potentially a Junior ADU. We've decided to divide the 3600sqft of living space and detached garage and build our the house in to a multi-unit rental. Since that discovery and decision, I've been scrambling to get as much education on the topic as I can. I started with ready rich dad, poor dad. Then million dollar real estate investor. And now bigger pockets rental property investor. Started listening to the podcast as well! All really fantastic reads and hugely helpful!

I feel a little bummed that we missed out on so many other great deals in the area back when we got this house. I do feel very fortunate to be where we’re at now having gained all the skills in carpentry, restoration, and design. Plus the house is fully paid off and we have the cash to do the build out.

My plan is to make the conversion, do it tastefully and not cut corners, get cash flow from this place. Then our next I want to get would be triplex or multi unit. Use the cash flow from the Logan house to repair the new place then rent and start paying down that loan. Then move to another place and repeat! Eventually I would like to have enough cash flow to pay others to do the work of finding deals, upgrading the units, and managing the properties. For now we’ll start with this project and see where it takes us!

I would love it if anyone would suggest any other books or sources of information that might help in this endeavor. Also, if anyone lives in the San Diego area and would be up for a coffee or lunch chat, let me know! I super stocked to get going on this and to learn as much as I can!

Sincerely,

Nate