Helping Client on 1st Rental Property

[Parker Cermak]

Hello all! Thought I'd share one of my recent closings with a friend of mine that has been studying the BiggerPockets podcast and reading BP books for last few months. He was a UPS Driver like myself, and had quite a bit of time while driving to learn and take in content. A few months ago a 1 bed 2 bath home came on the market for $40,000 not far from my buyers primary residence in Cass Lake, MN not to far from my primary market in Bemidji, Minnesota. We made an offer at $20,000, and the seller countered at $27,000. After that accepted offer we went a head and scheduled the inspection, where the home it self was in great condition, however the roof and getting close to the end of its life. We negotiated $2000 off the purchase price, making our ending sale price at $25,000. My buyer has a renter lined up to pay $600/month plus paying their own utilities. At such a low purchase price we couldn't find a lender to do any more then a 10 year amortization. Cash flowing $245/month, at a 51% return. Not necessarily a smoke show amount of cash flow right away until paid off, but a good first deal to get his feet wet with a good return. Thought I'd share this story, thanks for reading!