3 Unit Close to Home

[Alecia Loveless]

Investment Info:

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

Purchase price: $200,000
Cash invested: $60,000

Found this property through my realtor who had sold it to its current owner years before. She was ready to downsize and listed it for $300,000. I knew it would go fast once it hit the open market, I got it before it hit the MLS and once it was inspected we mutually agreed to drop the agreed on price by $100,000. One of the 3 units needed to be refinished, and two were rented. After closing we got the unfinished unit completed and placed a tenant.

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

Realtor had great relationship with his seller and brought the deal right to me once he had the details of it worked out.

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

Realtor brought it to me, and once the inspection was in I got a contractor to look at the details brought up in the inspection and renegotiated the price with the seller.

How did you finance this deal?

Traditional bank loan.

How did you add value to the deal?

Finished the unfinished 3rd unit, and have begun making the necessary repairs to the building. Have spray foam insulated the basement to one of the buildings, and am looking to better insulate the actual living space of one of the units. Have made necessary repairs to one of the basements, there are two buildings on this property, to solve a moisture problem, and will do some carpentry work to resolve some dry rot problems as time goes on.

What was the outcome?

Now have all 3 units rented to full capacity and might have two more projects left to do on this building in the future.

Lessons learned? Challenges?

Have found the "best" building inspector to use up here. He has saved me a ton of money and headache with several properties, and on my first deal I used a different one and he missed a bunch of things that ended up costing me for issues that were missed. Don't settle for less than the best when using experts and contractors on your projects.

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

Charles Crannell my agent from Badger Peabody Smith Realty, Mike Talotta from Northern Vista Home Inspections, Janet Costa and Conor Joyce from Mascoma Savings Bank as lenders.