Real Estate Investment #1

[Grant Rutherford]

Investment Info:

Condo buy & hold investment in San Diego.

Purchase price: $680,000
Cash invested: $25,000

Bought a new-build 3 story 2 bedroom 2.5 bath condo in a 4 unit building with a friend using my VA loan, we lived in it for a little while and have been renting it out the past couple years using a property manager.

How did you finance this deal?

VA loan, partnership

How did you add value to the deal?

We refinanced at 6 months after purchase and currently have a 3.25% interest rate. Simply holding and renting the property for 6.5 years has led to significant appreciation and equity despite being cash flow negative.

Lessons learned? Challenges?

After moving out we self-managed and rented to some college students who signed a 12 mo. lease but left after 9 mos. We decided to use a property manager after that. After paying mortgage, taxes, insurance, HOA, and property manager, we are not cash flow positive on the property yet. While we could easily charge more for rent in the current market, we have had great tenants for the past 3ish years and have decided that keeping good tenants happy is more important than making a little money.

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

Yes!
Agent: Melissa Costa
Broker: Todd Benware
Property Manager: April Steingrebe with New West Property Management