Fell into being a landlord

[Greg Appelt]

Investment Info:

Condo buy & hold investment.

Purchase price: $86,000

Townhouse style condo with driveway and garage. 2/2 in gated community.

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

After the crash of 2007 (where I happened to sell my home at the top of the market) I found a foreclosure selling for 33% of original value. Purchase with my VA loan intending to become my residence. After fulfilling the commitment, started renting it with 30+% cashflow. I've only had 2 sets of renters since I started renting it. Now I'm trying to get a LOC so I can do more investing!

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

Bank REO came on the market across the street from where I was renting.

How did you finance this deal?

VA loan

How did you add value to the deal?

Slowly upgrading items once they have been depreciated (appliances)

What was the outcome?

Continuously cash flowing, mortgage getting paid off by renters, property appreciating 150%.

Lessons learned? Challenges?

Use the best lending options you can. Structure your lease so tenants stay forever even if that means being slightly below market. Make sure you put the profits into a reserve account. You never know when you'll need a new AC/ref/water heater.

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

So long ago I doubt they are still active.