First Investment Property 2011

[Mandy Kulesa]

Investment Info:

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

Purchase price: $165,000

First Investment Purchase, House Hacked Duplex - Purchased in a normal Real Estate market in 2011

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

We wanted to purchase a home and none of the single family homes we looked at were hitting our goals, so we opened our search to include Multi-family and liked the idea of someone else paying our mortgage.

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

We worked with an experienced Realtor. We provided a lease back option for the seller to find a home as well.

How did you finance this deal?

VA financing.

How did you add value to the deal?

We worked with the seller to be flexible in our closing date and provided lease back option for the seller to find a home too.

What was the outcome?

Our property came with a Section 8 tenant who had been living there for several years already. Once that tenant moved out, the unit needed a face lift after a really good cleaning - new flooring, new paint, and there were roughly a billion nail holes to fill. We lived in the other half and paid off debt and saved money to be able to purchase an additional property as our main living residence five years later.

Lessons learned? Challenges?

Section 8 housing can be beneficial but it also limits rental amounts to be charged and typically tenants who are home more, increasing wear & tear. We learned to bulk up our savings account for future expenses to the property - in a matter of 2 years we had to replace roof and siding due to hail storm and both units HVAC. Those are major expenses. We cut costs by doing some of the work ourselves. It's important to fully screen tenants, paying attention to red flags and call references.