Perfect cottage rental retreat

[Angie Blatt]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $85,000
Cash invested: $21,000

Single family cottage style home on large secluded lot. Gorgeous hardwood floors, extra basement and attic storage, large, flat, fully fenced yard surrounded by trees for total privacy, huge shed with electric to rear of property. This home is barely noticeable from the street as it sits atop a hill that is covered by a 15’ high stone wall with double sided stone stairs that leads to a gate at the sidewalk that connects the gorgeous fully covered front porch and side deck.

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

When I looked the property to help the owner list it for sale by owner I immediately saw and knew the rentals income potential for this type of property in this area. I ran the numbers and confirmed it was an amazing buy!

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

A younger gal who I used to babysit some 20 years ago asked me for help selling her first home she purchased a year prior when her relationship situation changed. She had a horrible realtor experience when she bought the home. Both buyer & seller agents & the FHA inspector missed live knob & tube wiring in the basement. 😳 When I looked at the house to help her FSBO it, I immediately knew the rental potential and made her offer that she accepted right away with no negotiating whatsoever.

How did you finance this deal?

I used a credit union commercial mortgage with 20% cash down, at a 10 year locked in term, amortized at 25 years. I paid all closing costs cash out of pocket.

How did you add value to the deal?

I pressure washed the entire house, porch, deck, fencing and sidewalks and cleaned up the landscaping. I updated the paint colors inside with modern light grey to brighten up the space and finished off a partial room in the basement into a “bonus” room that could be a bedroom, office or den. My costs were minimal since I did all of the work myself.

What was the outcome?

My outcome was phenomenal! I had over 400 online leads and well over 250 applications… talk about exhausting! 😬 I found amazing tenants who love their new home…. They moved in a month after I purchased it and told me they never want to leave. The house across the street sold for $155,000 a month after I purchased this… that home had a horrible yard and the entire place needed updating. The equity I have in this property from day 1 is absolutely amazing!

Lessons learned? Challenges?

None…. This was the perfect deal for the perfect property, with zero hiccups or regrets.

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

Phil Fry at Diamond Credit Union in Reading, PA was my go-to guy for this deal (again)…. He is top-notch to work with!