House hacking your first rental property

[Amber Straub]

Investment Info:

Small multi-family (2-4 units) other investment in Naples.

Purchase price: $553,000
Cash invested: $35,000

How I live for free while building my rental portfolio.

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

I changed my mindset around money making strategies like many of us reading "Rich Dad Poor Dad." After talking to other real estate investors and following @austinrutherfordofficial on Instagram, I slowly started learning about the idea of house hacking with an FHA loan only needing 3.5% down in order to obtain a highly valuable property.

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

I found this deal from out of state living in Washington State on my journey towards a quest to move to the state of of Florida. I made a trip to Florida, found an area I liked, then called real estate agents. From there I met with a team in person during my trip, explained what I was specifically looking for, which was either a duplex or triplex. They immediately started looking for deals for me. The agent was able to do everything I needed virtually, to take down my first deal  

How did you finance this deal?

I used an owner occupied FHA loan with 3.5% down. I supported this deal with my W2 income working as an intensive care registered nurse.

How did you add value to the deal?

I have slowly increased the rents as they were far below market rent. I have replaced 2 air conditioners, a water heater and done quite a bit of “lipstick” renos to add value to the property.

What was the outcome?

I now live complete rent/mortgage free and in only 6 months have added 100k of equity in my property just sitting on it. I am able to tap into this at any time.

Lessons learned? Challenges?

Learning to be a landlord with no previous home owner experience was tough! It’s a process you just have to live through, but so worth it. I manage my own property which saves money on property management. Having money stocked on hand to pay for things going wrong such as a suddenly broken $6000 ac is something to be prepared for! The challenge is tough, the learning curve is steep but the best finacial decision I’ve made. 

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

Yes! Angel Shackleford of Coldwell Banker on 5th Ave Naples, FL. Austin Rutherford for being my first real exposure to real estate investing education, he breaks it down in a way that is meant for the absolute newest of investors!