159 E Harrisburg Avenue

[Travis Hammonds]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $200,000

Doing a live in flip on an old farmhouse property in Elizabethtown Pennsylvania. I used a private investor to fund the closing and construction costs for the deal. I have rented out 4 rooms to friends of mine to cover the expenses of the property, netting me about 213/mth in cash flow. After a year I plan to reevaluate my equity to decide if I will hold or sell the property.

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

I needed to get something under my belt, and the property was listed at a discount because it was an estate sale. I saw the potential to add great equity in the property so I decided to pull the trigger.

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

I found the property while showing the house for a client (I am an agent in the area). Since I have little time in as an agent, I asked my friend to cosign the loan with me since he has solid work history. In return, I would give him equity in the property equal to what his first year in rent would be. I negotiated a price well under market value but with quick settlement and very few contingencies which was attractive for the estate.

How did you finance this deal?

I used a conventional loan around 94% LTV and had a private investor fund the closing and construction costs.

How did you add value to the deal?

I bought the property under market value, so once the appraisal cleared I added over 10K in equity immediately. I am also remodeling the home to bring up its condition, adding more value.

What was the outcome?

Still in progress

Lessons learned? Challenges?

It is a good idea to check the basic zoning guidelines before buying a home just in case you may not be able to do what you would like to.