Single Family Home w/ Free Equity

[Jason Coleman]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $82,000
Cash invested: $22,000

Purchased this 2/1 single family direct from client/seller. Typically I don't like 2 bedrooms homes but this one had a ton of equity built in at purchase. This is a client of mine who I sold off some of their portfolio and purchases another couple of properties from them. Rehab will be minimal upon tenant turnover. Flooring, paint, some cabinet refinishing. Solid deal with 18k worth of free equity day 1. Not a bad deal in a crazy market. Bumped up rents within 30 days of purchase so my cashflow is about 150/month on top of all expenses. 3.75% interest, no points. These rates are unbelievable. I refinanced another property so I technically purchased this property without any out of pocket cash. Tenant is qualified and looking to purchase a single family house as well. So this purchase will also make my realtor business more money. Still loving this game : )

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

Free Equity with minimal rehab.

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

A client referred me to another portfolio seller.

How did you finance this deal?

Straight conventional w/ 20% down financing

How did you add value to the deal?

Will renovate when tenant moves out and increase rents another 150/month.

What was the outcome?

Solid buy and hold with minimal deferred maintenance.

Lessons learned? Challenges?

This one was pretty straightforward. Which isn't the norm haha.

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

I am a licensed agent. Will end up selling another 3-4 of this clients properties then purchase another from him most likely. Investor/Agent for life!! ; )