First investment purchase

[Kyle Smith]

Investment Info:

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

Purchase price: $455,000
Cash invested: $159,250

3/2 duplex in a nice neighborhood in Nashville 5 min from Grand Ol Opry, 15min to downtown and the airport. The seller was a investor himself. Being my first purchase great experience so far learned a lot.

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

It cash flowed better than single family home and the location was good. Plus I had friends that were happy with their property manager out there, since I live out of state I could use him.

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

On the MLS, called the person directly and did a for sale by owner deal which I received $15,000 of closing. That was the only negotiating. The property was in good shape and passed all inspections. Market is too hot to start nick picking items.

How did you finance this deal?

I did a cash out refinance on my primary residence back to a 30 yr fixed. I will then take the cash flow from the investment property at the end of the year and put it back into my primary residence to pay down the principle, having it paid off in 15yrs.

How did you add value to the deal?

I plan on putting in a new fence. With gates on both side to give direct access to to the open field/park behind the duplex. Upgrading the back patios to create a more user friendly environment. Both combined should give the feel of more user space encouraging people to spend time outside. I will also add a small storage shed for each unit.

What was the outcome?

End result not determined yet, but with them being newly remolded, good size compared to most this should demand the highest rent possible for the area.

Lessons learned? Challenges?

The entire buying process and transition over to new property managment.

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

Yes I worked with a investment specialist within the Firefighters First Credit union. They helped with the cash out refinance on my primary residence and the purchasing process of the investment property. They are also helping me with the steps to form a partnership/ LLC for the next investment property purchase which will be apartment complexes.