Our first step towards financial independence!

[Matias Torres]

Investment Info:

Single-family residence other investment in Rialto.

Purchase price: $335,000
Cash invested: $10,000
Sale price: $560,000

This was my wife and I's first home, we bought it as a primary residence and then sold it to scale up to a house hack.

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

Initially, we never thought we were in a good place to invest, let alone in the expensive assets category. Luckily, through the VA loan, we were able to buy without thinking it would open us up and give us the capital for a bigger investment.

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

MLS through a residential realtor that was recommended by a friend from work.

How did you finance this deal?

Freshly earned VA loan (right after my first deployment). Initially, we used the CalVet VA loan, which is a loan product in the State of California funded by taxpayers for veterans. The initial rate in 2016 was a 3.25% 30yr fixed and then we financed into a 2.25% 30yr fixed in 2020.

How did you add value to the deal?

We did light work on one of the bathrooms, financed solar, painted the exterior, purchased a water softener, and remodeled the kitchen. In that order from less expensive to most expensive.

What was the outcome?

Funny enough aside from the exterior paint, none of the improvements were looked at as value add more than just blind "home improvement" at the time, perhaps a better description would be a coincidental value add. Between the improvements and the asset appreciation, the home went up $225K.

Lessons learned? Challenges?

Definitely, be intentional about the money you spend on an expensive asset and seek to add value with an eye on your desired outcome.

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

Calvet Home loans was a great lender. Deborah Hibma was of great help during the acquisition phase (I am not aware if she does any purely RE investing deals). The Gwilt Real Estate team was excellent on the exit strategy and made the sale a breeze at a price we were happy with.