House hack SFR in New Haven area

[Ashleigh Evans]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $115,000
Cash invested: $35,000

Home was bought using a conventional homestyle renovation loan. This is a private residence/ house hack. House was a short sale. Put 3.5% down and closing costs. Mortgage was $1200 and roommates paid $750 each. However, taxes have gone up exponentially since moving in.

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

At the time, the cost of renting vs owning made house hacking a no-brainer. Homes also aren't very well kept in New Haven, so I knew I would be much more comfortable in a house that I renovated to my standard than I would be in one that I depended on someone else to fix for me.

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

I didn't - this is a school I still need to work on and improve.

How did you finance this deal?

conventional homestyle renovation loan with 3.5% down.

How did you add value to the deal?

Right now, the tenants cover $1500 of a $1550 mortgage. I could go up on rent and will when we all move out in December. Their financial assistance via paying my housing expense while I get my masters has proven to be invaluable.

What was the outcome?

Right now, I have about $120K in equity.

Lessons learned? Challenges?

Contracting. I will never go with an "investor-friendly independent contractor" ever again. I ended up firing a contractor in the middle of the job and almost ended up homeless. I didn't have a bathroom until 3 days before school started. We didn't have AC until October, didn't have heat for the first winter. It was pretty terrible. The value of this property was definitely the way it forced me to grow as a both a person and investor.

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

Ken at Baybrook Remodeling saved my tail in a major way. He essentially began fixing someone else's mistakes. Cannot recommend enough.