4 plex brrrr and fire damage

[MIlton Monzon]

Investment Info:

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

Purchase price: $173,000
Cash invested: $77,000

One of 4 units was burned for this property. Needed a total gut and everything done to it including siding, windows, sump pump. I bought it with the roof completed so that was a plus. Wholesale fee of 13k and a contractor scamming me. Tons of lessons on this one. 3/4 units were empty needing a full remodel. Got it done and now all fully rented and modernized. Expected a 260 ARV and the appraisal came back at 319k. Got all my invested money in and more to reinvest and still have cashflow.

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

I was intimidated by fire damaged properties but the numbers made sense and I took the risk. Def had a few anxiety attacks taking the leap. Turns out the biggest risk here was not the fire damage but the CON-tractors that stole approx 22k. Had they not I would have only used 55k of the 77k listed.

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

Wholesalers given to me from references. Biggest thing was networking and being the first one to be given the offer was a plus. Being an out of state investor having a well established team was critical. Luckily to start off I had that with my agent, property management, etc.

How did you finance this deal?

RCN capital was a huge help for this deal. Could not and would not have done it without them.

How did you add value to the deal?

Remodeled all units with LVP, stainless steal appliances, electrical, plumbing, and lunar paint throughout.

What was the outcome?

Tenants that met all the rental criteria, support from the community, debt paid out.

Lessons learned? Challenges?

This one is tough. The contractors that scammed me had already completely 3 other projects for me and did a fantastic job. I even took them out to dinner when I visited. I interviewed them, had referrals, checked their EIN and records, etc. At the end of the day I still got scammed. Then they did it to a lot of others in the same time frame.

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

Yes Brenda Engel from New London Ct, amazing agent and RCN Capital.