Buy/Hold air bnb potential 3 bedroom 2 bath w/guest house.

[Scott Hotchkiss]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $403,000
Cash invested: $90,000
Sale price: $446,000

3/2 with 1 bedroom guest house. Renting house for $2000/mo and air bnb the studio $1500/$2000mo.

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

The location is in a B class neighborhood. It is a 3 bedroom that could be 4 by converting enclosed back porch. It also has a free standing guest house with separate entrance and yard that will make a great air bnb. It has a 10x60 workshop/storage unit which will hold all of my tools and be used for property management. There is room for 2 R/V's and 4 cars to park.

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

I am a realtor.

How did you finance this deal?

I borrowed down payment from investor and hard money. Refinancing in 6 months.

How did you add value to the deal?

I am using my commission for upgrades to the property. Based on my comps, I got seller to come down 30k on purchase price. I can do most of the remodeling myself. I have done extensive remodeling in my previous career.

What was the outcome?

We are closing tomorrow.

Lessons learned? Challenges?

Do your taxes and you may not need to refinance in 6 months on the next one. I need to build my credit lines and my credit score.

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

I found this property while looking for property for another investor. I went through 3 lenders for traditional financing and failed. Using hard money now to close deal.