Second investment property

[Nolan Chandler]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $208,000
Cash invested: $47,938

The home is right outside of Camp Lejeune and has a sunroom as a nice bonus to the property.

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

I was looking for a long-term rental to diversify from the first investment that was a short-term rental. This property is right outside of Camp Lejeune and I hope that this provides stable cash flow and appreciation.

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

I came across it on Zillow and I brought it to my realtor's attention. The house needed many repairs--large and small--before we could rent it out. This included receptacles and covers, the crawl space, and miscellaneous handyman items. Sellers agreed to drop the price from $221,000 to $208,000 and include a $15,000 credit at closing for the repairs.

How did you finance this deal?

I used a debt service coverage loan for this property and it required a 20% down payment. I used a company, Hometap, to provide funds for the closing cost in return for their share in an interest in the appreciation of my primary residence. You can either pay them back before you decide to refinance/sale, or they will be paid upon refinance/sale.

How did you add value to the deal?

On top of the repairs with sellers' credits at closing, my friend and I stained and refinished the wood flooring throughout the entire house in order to save on costs.

What was the outcome?

We were able to get the house rented fairly shortly after all repairs were completed.

Lessons learned? Challenges?

Contractors and handymen have ever-changing schedules. I initially thought that our scheduled dates for the three workers were set in stone. I learned that previous jobs set them back, and at my property there were some reasons here and there for some delays. I also learned that I need to be aware of this for future properties and plan accordingly. Additionally, my wife advised me that the floors needed to be refinished before anyone would rent, and long story short, she was right.