Seller Financed Duplex

[Jason Coleman]

Investment Info:

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

Purchase price: $185,000
Cash invested: $12,000

Seller Financed Duplex @ 5% down. I ended up rolling equity from a refinance into this property so there was no cash out of pocket. Was able to increase rents 400 dollars/month total within 30 days of purchase. Market rents are another 100/month higher per unit. Considering turning it into an Airbnb or post on furnished finder once tenants move out. Appraised for 15k over my purchase price within 3 months with zero rehab. Another portfolio deal where I sold off most of the sellers properties then purchased one or two directly. Love being an agent ; )

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

Small Multifamily in an excellent area of town. Option to turn into a STR if needed. Market rents were considerably higher. Seller was interested in financing at a decent price.

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

On old roommate called me and was looking to buy a property directly from his landlord. I spoke to the landlord and facilitated that transaction...for free ; ) Turns out this seller had 8 other properties to sell. I sold 7 of them to my clients. Then I purchased this duplex at the end.

How did you finance this deal?

Seller Financed note with a shorter (than I prefer) balloon payment of one year. I knew I was going to refi sooner than later.

How did you add value to the deal?

Immediately increased rents. Option to renovate for much higher rents.

What was the outcome?

Solid buy and hold with more potential as an airbnb.

Lessons learned? Challenges?

Get the deal under contract quickly and figure out how to finance later. I ended up doing a rate a term refi to lower my payments and pay significantly less interest just 3-4 months after purchase.

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

I am a licensed agent. I cannot stress how important that is to find deals in this crazy market : )