Our first investment property

[Sarah Palenske]

Investment Info:

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

Purchase price: $389,000
Cash invested: $17,000

4 plex
2 bed 1 bath units in a central location

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

This was our first purchase. We sold our single family home and owner occupied this building for 1 year.

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

We found it on our local MLS and put in an offer. It almost fell through but we ended up pulling the trigger at the last minute.

How did you finance this deal?

FHA

How did you add value to the deal?

We made cosmetic upgrades to this building as two tenants vacated.

What was the outcome?

We have excellent tenants and pretty good luck with this building.

Lessons learned? Challenges?

I learned that if a building is older and it is a good deal, it is necessarily going to be great for cashflow. For instance this building has appreciated for us, however the maintenance costs are higher due to it's age and that eats up it's cash flow in reality.