Duplex in Memphis

[Emily Shay]

Investment Info:

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

Purchase price: $348,000
Cash invested: $86,000

4/2, 2/1 duplex in B+/A neighbourhood. Original asking 395K. Purchased vacant. Light rehab needed. Pending tenant placement (Projected rents: ~3000-3200/mo total).

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

I like multifamilies, I'm focused on cashflow and scaling.

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

Found this on my own on the MLS, had my realtor (eventually) engage the seller.

How did you finance this deal?

5/1 ARM commercial loan product, 20% down.

How did you add value to the deal?

Seller simply wanted to off load the property, he had been through "enough" with it - this was his pain point. I submitted my initial offer and encouraged a counter - the goal: to get him conversing with me as opposed to shooting me down immediately or not even responding. Eventually we came to a number that was agreeable.

What was the outcome?

I got the property for 47K less than asking.

Lessons learned? Challenges?

If you can get the seller talking to you - even if your offer is "absurd" - you've made some ground. Once the seller is talking, you stop and listen to what they are saying (pay attention to the things that aren't said outright).
An "absurd" or "insulting" offer to you may not be considered so by the seller.
Go into the negotiations with ZERO neediness and zero expectations
Stay level headed - even when the seller is getting emotional.

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

Joseph "Joe" Doughton & Kimberly Nickelberry (Kaizen Realty)