Updated over 4 years ago on .
3 plex STR, corporate housing and residential rental
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $450,000
Cash invested: $24,000
Purchased a 3 plex with an FHA loan. Lived in it for a year, purchased a new home and turned the unit I was living in into a STR. The other 2 units are corporate housing and a residential tenant which more than covers the mortgage so the STR cashflow is free and clear.
What made you interested in investing in this type of deal?
I made a goal to have 5 doors in 10 years. Multi-family made it possible to achieve this goal in less than 2 years.
How did you find this deal and how did you negotiate it?
Found on the MLS and negotiated through the sellers agent.
How did you finance this deal?
$24,000 down and an FHA loan.
How did you add value to the deal?
The 3 plex was under valued as the owner was receiving lower than average rent for the area.
What was the outcome?
I purchased the property, moved in and talked to the tenants I inherited about what they liked and did not like about the old owner. I was able to use their feedback to offer them certain things like being able to have a pet in exchange for a new lease which allowed me to raise the rent immediately.
Lessons learned? Challenges?
There was really no challenges. It has been a well oiled machine pumping out cash since almost day one.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I represented myself which was another benefit as I was able to put my commission of 2.5% toward the down payment.