Getting Started After Reading Long Distance Real Estate

[Philippe Ueng]

Investment Info:

Single-family residence buy & hold investment in Flint.

Purchase price: $42,500
Cash invested: $46,700

$10K down with $43K private funding at about 4% interest. The property actually cashflows $300/month.

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

I wanted to build passive income, and after reading Long-Distance Real Estate, putting in a lot of research, and building a team, I was finally able to put this deal together.

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

Zillow, and I reached out to the listing agent directly. As an agent myself, I worked out all the terms and made an offer. Documents were e-signed to me, and a title company handled the whole transaction (it's not common practice to use escrow in Flint).

How did you finance this deal?

I had a family member who was willing to fund the deal for a monthly payment. Worked out the terms on a 1-page note, and it was signed by both parties.

How did you add value to the deal?

The house was already ready to be sold, but had been vacant for a long time. My PM was able to clean out the property and get it leased at market value.

What was the outcome?

Currently the tenant has moved in and pays on time. There were a bunch of hiccups and lessons in the beginning, but it's running smoothly.

Lessons learned? Challenges?

Always budget for more up front expenses than you think, and always hound your PM to tell you everything up front (which they might not do in order to sign you). When I got the property, my PM looked around and said it would cost about $1000 to fix it up to market conditions. After the tenant moved in, we had additional expenses, and I ended up paying out $2,700, and had 2 months of prorated rent.

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

Calvin Roberts, home insurance. Great work, versatile policies. Made my insurance cheaper than I thought.