Michigan Property 1

[Matt Jamieson]

Investment Info:

Condo buy & hold investment.

Purchase price: $49,900
Cash invested: $20,000

2BR 1BATH Ranch Style Condo (817 square feet on main level & unfinished basement)

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

I was in college at the time and working as an assistant to a real estate appraiser. He lived in this particular community and recommended I buy one of the condos for sale, because the prices had dropped significantly compared to years prior. I did not have high income at the time, but was able to qualify for an FHA 30 year loan on this low priced condo. It was right down the road from my job and worked out really well at the time.

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

Found it on the MLS. Paid full price.

How did you finance this deal?

30yr FHA loan with 3.5% down.

How did you add value to the deal?

Replaced all the flooring, kitchen cabinets, Kitchen appliances, painted, new toilet, new bathroom fixtures/vanity and light fixtures.

What was the outcome?

Lived in the unit while working on it and had to move out of town for a job. We then kept the property as an investment and have been renting it to tenants ever since. Not a high cashflow unit, but has been fairly stabilized for most of the years we have had it. Primary benefit has been mortgage debt paydown, access to equity and overall appreciation on the unit.

Lessons learned? Challenges?

HOA fees eat into the cash flow, but also reduce occurrence of variable expenses (Exterior maintenance and capex).