2nd Buy & Hold Rental Townhome

[Justin Long]

Investment Info:

Townhouse buy & hold investment.

Purchase price: $185,000
Cash invested: $45,000

This is a townhome purchased as new construction.

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

The first buy and hold rental townhome is located in a community and the builder decided to add a phase II. I checked what the list prices were for these yet-to-be-built townhomes, and based on the numbers I ran, calculated a decent ROI based on market rents as well as comparing what my current rental was bearing at the time. I had funds available, so increased my portfolio from a property count standpoint by 100%!

[Justin Long]

Quote from @Matthew Morrow:

That is fantastic!. What a perfect time to get into it also. Although cost can be high and material certainly have been a challenge – you now have three solid years into this and I’m sure appreciation has treated you well.  

The tenants make or break the experience as you’ve found, especially in the beginning for the first several properties.  

Best of luck!


Quote from @Justin Long:

Quote from @Matthew Morrow:

@Justin Long nicely done! Are these performing already? or still under construction. 

 Thank you sir!  I actually purchased back in 2019 (just added this investment into my profile, which prompted the post).  Back then material costs weren't nearly as high, demand wasn't quite as high, and the builder just wanted them off the books.  

It is performing well!  I wished I had more funds to allocate back then to buy more than 1 property.  The rent/price is very good in this area and having great tenants help tremendously.  

 It has.  It's been tempting to want to sell, but I don't want to disrupt the tenant experience or pay the LTCG taxes right now either. 

And yes, tenants make or break the experience.  Before I ever bought my first property, I talked to a co-worker that told me horror story after horror story based on his buy and hold experience.  He had purchased several C/D properties in a bad area, and didn't properly manage them.  He gave me a blueprint of what NOT to do as a first time investor.