Duplex w/ granny flat. Adding 2 more ADUs on the lot.

[Lawrence Feder]

Investment Info:

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

Purchase price: $730,000
Cash invested: $6,500

Duplex home, with a small granny flat in the back. First floor is has a main unit 3/2 newly renovated with new appliances, pass-though door is 1/1 unit (granny flat) newly renovated with new appliances as well. Upstairs unit is a 2/1, newly renovated as well. We are in progress of adding 2 more ADUs in the backyard. Totaling 5 doors on the property when completed. ADUs should be complete by mid 2022.

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

It was a great property to live in while continuing to add value. Lived in 1 unit, and rented the other 2.

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

Found via our RE agent. It ended up at appraising at value.

How did you finance this deal?

Using the VA loan. Was able to get in at 2.75%, refinanced down to 2.25% FIXED for 30 years (such a great rate)!

How did you add value to the deal?

The upstairs unit was the only unit which was not renovated. While living there, i got the entire unit renovated. Added new appliances in every unit, and added a community washer and dryer in the back. Going to add an island to the 3/2 when tenants move out. Added Solar. Also considering adding mini split A/Cs for all units.

What was the outcome?

Purchased for $730k. Reappraised for $950k. Invested around $10k in upgrades. Huge success!

Lessons learned? Challenges?

Having to deal with the split utilities in an odd scenario. There is split metering between upstairs and downstairs. We had to calculate and figure out how to do split utilities fairly. We ended just going with an average $50 per person in each unit.

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

Real Estate agent- Donald Appleberry - eXp Realty
Property Manager- Ben Ream - Tandro Homes

****Sorry, this was supposed to be an edit post, i can't delete posts apparently***