Rooming House Experience

[Jason Coleman]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $195,000
Cash invested: $28,000

Seller financed deal at 10% down 5% interest. Older lady wanted the cashflow instead of a lump sum at closing. We are tearing down this house eventually and building a multifamily complex on the land. This is currently operating as a rooming house. 12 bedrooms, 3 bathrooms. Bathrooms are cleaned weekly by professionals and the house is treated for pests monthly. This helps with complaints from tenants.

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

The development potential.

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

On the MLS then communicated with the seller the benefits of seller financing.

How did you finance this deal?

Seller Financing

How did you add value to the deal?

Paint, roof patches, not much rehab on this one. Painted 6 rooms.

What was the outcome?

Buy, Teardown, Build. #thatstheplan

Lessons learned? Challenges?

YES. Rooming houses are a whole different ballgame when it comes to management. It's very difficult to find a PM that will manage these properties for us. The are a nightmare to manage but it's decent cashflow AND a temporary rental play.

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

I am an agent as well as an investor