My sixth investment property

[Tim Mieney]

Investment Info:

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

Purchase price: $206,000
Cash invested: $17,500

My sixth investment property (another quad). This was the only property we've ever purchased off the MLS and the upkeep has been a bit more than we bargained for. The property was and still is fully occupied. It's a beautiful property that sits on almost 4 acres of land with a long driveway through the trees, a small pond, gardens etc. Proud to own it, but it wouldn't fit our current criteria any longer.

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

The property is gorgeous and the proximity to our other rentals was ideal. We inherited four tenants and it was great to have cash flow from day one.

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

MLS, negotiated through our agent.

How did you finance this deal?

A combination of hard money and a HELOC. We then refinanced into long term debt after three months with our local bank, leaving minimal money in the deal. The current market appreciation allowed us to make this happen.

How did you add value to the deal?

Better management systems for the tenants who were used to having to pay cash to the previous landlord. Physical improvements have not been made, but we will update units upon turnovers.

What was the outcome?

Still operating with paying tenants. There's a development going in down the road that we had hoped would expand over to us and a potentially lucrative sale would be in order. If that doesn't come to fruition, we'll continue to hold, collect rent and enjoy mortgage pay down, appreciation and the depreciation benefits.

Lessons learned? Challenges?

We didn't anticipate the amount of upkeep the property would have. It hasn't been awful by any means, but our other properties have much less upkeep. Again, a beautiful property that tenants love and we're proud to own, but we didn't consider the upkeep enough prior to purchase. Nevertheless, it's cash flowing well and we were able to refinance into long term debt a few months after purchase and only left $17,500 in the deal.

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

Agent.