First investment property

[Robert Thomas]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $85,000
Cash invested: $5,500
Sale price: $110,000

1200 sf ranch on slab single family property. 3 bed 1 1/2 bath with attached 2 car garage.

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

I was interested in buy and hold property in this investment area. There were a shortage of rental properties in town and this property was at a good price point for my wife and I. We only had to make minor upgrades of paint and floors.

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

We first saw the deal and it was under contract. However, financing fell through and was put back on the market. We did a walk through with an agent, calculated the minor rehab cost and made an offer based on the AVR after rehab.

How did you finance this deal?

We financed the deal with a conventional loan. 25% down

How did you add value to the deal?

Minor upgrades to the bathrooms, flooring and paint

What was the outcome?

1 renter for three years and sold the property for $25,0000 over purchase price.

Lessons learned? Challenges?

1. We Should have never sold the property.
2. Look for properties you can add value to.
Challenges:
Self-managing the property, and making sure you have a great lease agreement