4plex in Anchorage

[Dave Velasquez]

Investment Info:

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

Purchase price: $325,000
Cash invested: $11,500

This was one of the first 4 plexs I ever bought. We bought this and lived in one unit. It was a bank owed property so it was vacant when we purchased it.

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

We needed a place to live and didn't want to rent or buy a single family house as that didn't make a lot of sense. We wanted a 4 unit for the security of multiple tenants.

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

I found this thru a real estate agent. it was 4 plex on a duplex lot so we made two offers to the bank. Offer 1 was based on the bank getting a grandfathered in letter from the city at 350,000. Offer 2 was in the event they could not get the letter from the city we would pay 325,000. Ultimately they were unable to get the letter so we paid 325k

How did you finance this deal?

FHA 1st time home buyer

How did you add value to the deal?

We did a few updates but really just rented up the units. we knew it would cashflow at market rents.

What was the outcome?

Things went well and continue to go well at this property. we have had it painted and updates certain things, remodeled units as needed and changes appliances but its been a good property and we have a significant equity position since we purchased in 2009 .

Lessons learned? Challenges?

Just go for it. the fear in your first deal will always be there, but you have to move forward cause you cant steer a car that isnt moving. you can turn the wheel for hours in the driveway and plan your rout but you have to release the parking break and start going. even if your in reverse, at least you know your first step is to change the direction of travel. but in the driveway, with the break set, all the steering and gear shifting and analyzing wont get you anywhere. pop that clutch baby!