First time-house hack to short term rental then sale

[Jared Johnson]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $237,500
Cash invested: $60,000
Sale price: $314,000

This was a house hack 3 bedroom townhouse used as short term rental for 18-months after first year. Sold for $70,000 profit after all commissions and fees. Average yearly return over 30%

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

It was a distressed property for sale by owner and we didn’t use agents. The seller needed to move quickly because they had a contingent offer fall through and gave a discount on the purchase price with money back at closing…wholesaling was the initial strategy but the home was in such good condition that it was used to hack then as a short term rental

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

Through internal networking

How did you finance this deal?

Traditional lender

How did you add value to the deal?

We rehabbed the flooring, updated the fixtures, cabinets, paint, and living area.

What was the outcome?

We rented private rooms in the home and created positive cash flow after 6 months learning the platforms and marketing. We sold the property because we dissolved the partnership and wanted to cash out

Lessons learned? Challenges?

Having strong partnership agreements in place is important. Setting expectations early. Maintaining clear communication and being proactive. Keeping properties longer adds value to your strategy if it’s in a area with little competition for rentals

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

We worked with a local realtor to help in the sale and he was knowledgeable and had good area connections…Gary Mead