Story TIme! 21 yrs old, first deal. How’d I do?

[Kyle Knowles]

I've looked to start investing in Scranton, PA. Scranton is a down market right now and has been definitely for the past 5 years and some may argue even 10. Due to this, Forbes has labeled Scranton one of the top 5 cheapest cities to own a home in the country.I realized that Scranton is a decently big city and to tackle on the entire city would be ridiculous, so I printed out insights on every single zip code and niche'd in on one particular one. After looking at a house that caught fire a few blocks down, the Buyer's agent informed me about the zip code I later decided to focus in on. Furthermore, I started looking at houses in the area on the MLS and quickly started doing a quick run of the numbers on multiple properties. I decided a fully rented duplex would be easiest to handle due to the fact I live out of state and they already have property management. However, after calling the seller's agent, we got him to inform us all about the seller's situation and even about some pocket listings that had not hit the market.

We discussed the duplex over the phone and I said I'd like to walk some of the other properties he was selling in the area. Fortunately they were all being sold by the same small LLC. I already knew what houses I wanted before I walked them. I decided my max budget was $135,000 for a 4 bd/ 2 ba duplex listed at $95,000 and a 3 bd/1 ba SFH originally listed at 105,000 but dropped to 68,000 after someone fell out of a previous deal.

The duplex is already pulling in gross $1,200 and the SFH is vacant. I put in an offer at $125,000 and they countered at $135,000. I then countered at $132,000, really wanting this deal. They accepted and we went under contract. After doing some inspections, I had to do some more negotiating. I knew the SFH needed a top to bottom reno, but the duplex also needed roof repairs, a new water line, and structure repairs due to a neighbor's gutter being broken and the basement being saturated. After much negotiating, they finally accepted an offer of $114,000.

How did I do? I’m paying for the homes in cash and have a Line of Credit to do the renovations. I don’t know what the market will be like when I finish reno, and I don’t think anyone does. However I plan on doing a cash out refi, and just repeating the process. Please hit me with all the advice you have!