First rental property from buying foreclosure

[Alex Austin Kendall]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $54,000
Cash invested: $15,000

2 bedroom 2 bath large lot 1400 sq ft

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

This was a foreclosure sale that we ended up being the only bidders on. The home was valued at $90,000 as it sat.

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

Newspaper legal notice

How did you finance this deal?

Private loan

How did you add value to the deal?

New flooring. New bathroom. Paint inside and out. New heat/AC. New countertops.

What was the outcome?

$500 a month instant cash flow. Took 3 weeks to renovate. Got a tenant in by December 1. ARV is $130,000. Bought for $54,000. Renovations cost $15,000.

Lessons learned? Challenges?

Renovations cost more than you think. Always ask yourself if you are adding value before ripping something out. Remember to differentiate between a rental and a flip. But nicely renovated rentals grab more money monthly.

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

I was the agent.