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Updated about 2 years ago,
403 Mcbaine Columbia MO single family BUY-HOLD
Investment Info:
Single-family residence buy & hold investment.
Purchase price: $80,000
Cash invested: $52,500
Sale price: $1,300
FULL gut and remodel. Major repairs are as follows:
-Cleaned up and rewired electrical where needed (home had live knob and tube that was spliced into)
-pulled up floor boards to access crawlspace to repair and replace damaged support beams, floor joists as well as install a sump pump and level out dips in ground (there was over 1 foot of standing water in certain areas). This took a long time as we later found out there was an old chimney (2000+ pounds of bricks) hidden behind drywall that was being supported by the main floor. This was only discovered after we began working on the electrical. LESSON LEARNED:GET A FULL INSPECTION BEFORE BEGINNING REHAB! seems obvious, and I would have advised any buyer clients to do the same, but I figured contractor would have caught it, but it slipped his observational gaze.
-Added 3/4 bath to master suite
-ALL new interior (drywall, paint, all fixtures, flooring, appliances, kitchen, bathroom, cabinets, etc)
-new front porch
-removed eyesore fencing
-new interior and exterior doors
-all new windows
-new water heater and heater
Most of the heavy rehab work (cost) was obviously 'behind the scenes' stuff (foundation, electrical)
What made you interested in investing in this type of deal?
low hanging fruit, was able to purchase from a family member for a good price. They were wanting to use proceeds in a 1031 exchange.
How did you find this deal and how did you negotiate it?
Family
How did you finance this deal?
traditional lender
How did you add value to the deal?
added a bath. Cosmetic upgrade
What was the outcome?
Rent went from $700/month to $1300/month
Lessons learned? Challenges?
Always get an inspection, even when purchasing from family. Set stricter parameters and deadlines with penalties with contractor.