First investment property. 4-plex house hack in Denver from MLS

[Zach Bagby]

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Englewood.

Purchase price: $760,000
Cash invested: $60,000

House hack, I live in one of the units

Income ~ $4,250
Mortgage ~ $4,550
PMI ~ $425
Flat fee utilities covers everyone's utilities
30 yr conventional fixed at 4.5%,
5% down owner paid closing costs = $38k
My unit would rent for $1400 easily (2br/1ba) making total income $5,650
Once PMI drops, mortgage will be ~$4,125

Repairs were upgrading electrical, fixing drain, fixing boiler, new shower in my unit.

Englewood, CO

What made you interested in investing in this type of deal?

The goal of this deal was to learn and get into the game. I know there are much better deals out there. I needed a deal that if I had to leave the state I could hire management and still break even. I want to prove I can do everything myself before bringing in partners.

How did you find this deal and how did you negotiate it?

MLS.

They wanted to sell without doing any work, we made a deal that they would cover all closing costs. Appraisal came in $20k over sales price.

How did you finance this deal?

5% down conventional. 4.5% interest

How did you add value to the deal?

Raise rents, take care of deferred maintenance. move into worst unit to fix and remove smell.

What was the outcome?

Living happily in it now. I have a few upgrades I want to do before I move out.

Lessons learned? Challenges?

Cash is King. I made 8 or so offers before I got this one and 7 of them were beat out by a much lower amount all cash. Facebook Marketplace is the best place to get potential tenants. Cozy.co works great for small landlords like me. Having a supportive wife is key :).

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Melissa Smessaert - agent