Central Atlanta House Hack in Premium Neighborhood

[Emily Beatty]

Investment Info:

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

Purchase price: $1,199,000
Cash invested: $300,000

Premium, central Atlanta location in a modernized Duplex as a House Hack. My family and I live in the 3 bedrooms 3 bathrooms owner's unit that is 2500 square feet. The adjacent apartment is a 1 bedroom 1 bathroom furnished mid term unit rented to business and film professionals at $2800-$3600 per month. This pays around half of the mortgage and allows my family to live in a neighborhood with fantastic schools and walkability - an area that would normally be out of budget :)

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

Fully renovated and modernized property in one of the most coveted areas of Atlanta - Historic Midtown. Walkability and quality of life are above average for the area. Premium location attracts premium mid term tenants who want to experience being in the center of the city in a quiet and peaceful environment.

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

On the MLS. Had recently been reduced 150K in price and my husband and I happened to be the first ones into the property after the price reduction. Offered full price as we knew we would make it work for our families needs with the attached apartment paying half of the mortgage cost.

How did you finance this deal?

30 yr conventional loan @ 6.25% interest. 25% down payment still needed due to our debt to income ratio and portfolio of other properties owned.

How did you add value to the deal?

Unit next door was already furnished, but we modernized some of the furnishings and updated all of the linens + accessorized the unit with high end art and decor to make sure it would rent out at a premium rate. Lighting was all updated to modern and unique fixtures to draw extra attention as well. Connect with leasing agents involved in the industries we'd like to rent to - such as film and business professionals.

What was the outcome?

We are able to rent the 1 bedroom on a mid term basis for the same rental income as we would renting it out on a short term basis. Less turnover, less cleaning to be done, less damages with longer term high quality guests.

Lessons learned? Challenges?

Film industry has had some hiccups and we've had to pivot for different clientele lately. Living next door to short term tenants in a house hack vs long term tenants in a house hack requires some unique communication skills and expectations as a landlord and owner occupant. Work closely with our neighbors to be sure they're happy with our guest choices and they are not being disturbed.

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

I am a real estate agent and negotiate my own deals. This allows me to add a buffer in the purchase and have a modest budget to update properties upon purchase by using my commission from the sale. This can make a deal work and give me a little financial edge that other investors may not have to make a deal work financially.