House Hack #2 in Arlington

[Matt Solis]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $290,000
Cash invested: $71,000

HOUSE HACK #2

4B/2BA converted to 6B/3BA

Purchase Price: $290,000
3% Down Payment + Closing Costs: $15,500
Total Renovation Costs: $71,000
Seller Concessions: $15,500
Total Out of Pocket: $71,000

Gross Rents: $4075
PITI, Bills, Reserves: $2800
Cash Flow: $1275

CoC Return: 21%
Total ROI (loan pay down, tax benefits, ARV, appreciation): 100%+

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

High leverage, high cash flow

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

MLS. Needed lots of repairs, so we came in at asking and asked for 15k of concessions, they countered with 5k over asking, but retained concessions.

How did you finance this deal?

3% down conventional

How did you add value to the deal?

Added bathroom, bedrooms, new paint, remove popcorn ceiling, added insulation, new windows, repaired foundation, etc.

What was the outcome?

21% CoC return

Lessons learned? Challenges?

Get bids from contractors while you are under contract. Always get the work in writing. Make a payment schedule. Have lots of reserves.