First Deal Out of State Sight Unseen

[Morgan MacGregor]

Hi BP Fam! 

I am an investor originally from Northwest Ohio but have spent the last 10 years travelling the Mountain West working as a Park Ranger and Endangered Fish Field Technician. Currently living in Western Colorado. I have been educating myself relentlessly since I got the REI bug. I have a 14mo old daughter and supportive partner who are the main reason that I am immersing myself in Real Estate. I'm seeking passive income to spend more time with them and am building wealth so that we can all live the lives we dream about. Well all that education and all the dreaming are finally starting to take shape. I'm excited to say that I will be closing on my first deal next week! It's a Triplex in... wait for it... Hicksville Ohio! Maybe not as sexy as San Diego or Miami Beach but I found what I hope will be a low maintenance property in an area with demand for multifamily housing with long term renters(year leases) that will cash flow. Here are the numbers:

LP: 89,000  SP: 85,500 w 2k concessions  Appraisal: 86,000  

Ins: 857/yr  Tax: 1220/yr Maintenance/CapEx: 4,000/yr (The house was built in 1900 so I am trying to be conservative with saving for maintenance and Cap Ex) Lawn & Snow: discounted rent for one tenant figured into rental income. Tenants pay all Utilities

Rental Income: 1260 (1300 = market)

With these numbers, I am cash flowing at $350/mo. It would be cash flowing $700+ without saving for maintenance but those big ticket items that are sure to come up in the next 5 to 10 years or so.

Since it's my first deal, I still feel like I'm way out of my depth even after researching so much. I did have a concern when I went through the cold feet phase of being under contract. I was worried that I wasn't using my capital wisely. I am financing with a conventional 30yr loan at 25% down and 4.875% This ties up at least 24k of my available cash. However, I have talked to some lenders who are willing to do a portfolio loan so I am now looking at what I can do to invest the rest of my cash here in Western Colorado.

One thing that I have experienced in this process is that my strategy is evolving the more I learn about real estate and hear and read about the amazing things people are doing; the more I am thinking more 3 dimensionally about financing as well as mixing different strategies to suite my skill set and means. So far, I am loving Real Estate Investing! Hopefully, that continues to grow along with my wealth. Thanks all!

[Cody L.]

I just closed on a $6m deal (bunch of patio homes) on Monday.  Saw them last night for the first time.  It was at night and the damn place is gated (and I didn't know the code or have a key) so I had to hop the fence.   Thought they'd think I was a burgler.

THAT'S buying sight unseen  (not recommend but I can be foolish a bit)