Four Unit property in Pottstown PA

[Chris Good]

Investment Info:

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

Purchase price: $160,000
Cash invested: $15,000

4 units

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

I was interested in this deal because of the market and the opportunity to add value and force the appreciation.

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

I found it using direct mail marketing, I asked the seller what he needed for it and fortunately we were able to come to an agreement on a price and terms that worked for both of us.

How did you finance this deal?

The seller held 20% of the purchase price as a 2nd position loan. I got a bank loan for 80%. I paid closing costs and repairs with a line of credit a have on another property.

How did you add value to the deal?

Fixed up the apartments, split the water, boosted rents.

What was the outcome?

I could probably sell it for about $250,000 today it cashflows nicely and has great tenants.

Lessons learned? Challenges?

This is the first property I managed myself, I got a couple bad tenants from the start so I learned a lot about the importance screening properly.

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

The bank I'm using for the 1st position loan is Diamond Credit Union.