Our 7th, 8th and 9th investment properties

[Tim Mieney]

Investment Info:

Single-family residence buy & hold investment in Hilton.

Purchase price: $420,000
Cash invested: $85,000

Our first ever portfolio purchase. Used funds from my Roth for the down payment. The properties appraised for a combined $65K more than we purchased them for. Combining market appreciation and debt paydown from tenants, we now have about $90K in equity across the portfolio in just 7 months. Soon we will do one large portfolio refinance on all our properties and we'll pull out about $500K, which we'll 1031 exchange and leverage into $2M worth of higher quality and higher unit-count assets.

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

The instant equity potential and obvious market appreciation that single family assets have been seeing over the last 18 months. Up until this point, I had only invested in smaller multifamily assets because single families have minimal cash flow, but with the current market situation, taking advantage of the appreciation potential on single families was a no brainer.

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

From a local investor in a Facebook group.

How did you finance this deal?

Traditional financing with a local bank and leveraging funds from a retirement account.

How did you add value to the deal?

We've done several updates on each property, but nothing major. With the amount of equity we had from day one, we'll be able to refinance out all of our money at any time.

What was the outcome?

Still operating with happy, paying tenants.

Lessons learned? Challenges?

Make sure properties have a functioning sump pump. We had an extremely wet period in late summer and had water issues in all three properties.

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

Just our local bank as the lender.