3-9 23rd st, Battle Creek

[Jonathan Buelow]

Investment Info:

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

Purchase price: $89,500
Cash invested: $32,000

Bought our first multi-family investment property from a private seller who is on his way to retirement. Turn-key property, Appraised at $120,000. Plans to update it and see where it goes.

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

Stability of 4 units in a cheaper neighborhood with easy comps.

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

Introduced to the owner through another real estate investor in a college physics course.

How did you finance this deal?

Split purchase cost 50/50 with a high school buddy.

How did you add value to the deal?

Price was already extremely low but it had room for rent increase. 490-550 up to $650.

What was the outcome?

In progress currently raising rents.
One unit was empty and is now filled with a solid tenant.
2nd is struggling to pay but is working hard paying what she can.
3rd has declined to pay rent until their CERA is funded (Paid out on eviction court date 2 months after approved.)
4th has been paying on time every month including increases.

Lessons learned? Challenges?

Have current tenants re-apply for residency. One tenant cannot keep up with rent and the second has denied any payments for 6 months.

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

Berkshire Hathaway in Kalamazoo. Lindsey