Challenges with owning my first 2 Unit

[Gary Grant]

Investment Info:

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

Purchase price: $130,000
Cash invested: $30,000

We purchased this property in 2019. It is a commercial property located in downtown Carlisle, PA. The property is a 2 unit with which we just converted the attic into livable space. We rehabbed the two units and are getting well over the market rate for the area.

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

I was looking to purchase the 3 unit apartment that I already lived in and I just asked my agent to find me at least a 2 unit and I continued to live in my apartment. What I liked about this deal was that while it was a 2 unit I would always have some from of cash flow coming in to cover the mortage.

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

My agent found this deal for me. I wanted a two unit and it was in downtown area and I thought it was a great deal for me because it already had a long term tenant and it was kind of turn key. There was not much wrong. I did not really negotiate this property I just gave the seller what he wanted.

How did you finance this deal?

I got a commerical loan and I put down 20%

How did you add value to the deal?

So how I add valued this deal was that recently we rehabbed the place and put all new floors, lighting and fixtures. I also added a new bathroom to the one bedroom apartment. We are currently working on the exterior of the property painting and doing some cosmetic things.

What was the outcome?

One of the most beautiful things in purchasing this property is I learned alot from having some not so good tenants. After the add value I went about renting this property a whole different way. I raised the rent above market value and waited for the right tenant. I varified credit and did background checks. I offered to include one year of free parking for the two tenants. Its now turned into a good experience.

Lessons learned? Challenges?

One of the biggest challenges as a new landlord is trying to just get anyone to rent your place. I am a giving person and I just let people rent on their need for a place. Today I rent my place as if it is a business. I do all the checks that are needed for the place and nobody is getting through my process unless you pass all the steps. My motto is treat the tenant as if I was giving them a loan for a house.

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

I worked with Brandon Marpoe who did our first deal. He was easy to work with and found me something really quickly.