3rd ones a charm

[Andrew Newcomb]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $380,000
Cash invested: $95,000

In 2020 we Bought a 2 bedroom, 1 bath, outdated home built in the early 80s. My wife and i had been saving money from our day jobs and wanted to invest it in real estate rather than the stock market. At this point we already had two rentals and tangibly felt the ROI from real estate investing. We were very familiar with the rental market and what simple updates could bring a lot of value. So we bought a home near us, spent a couple months updating it and then rented it out.

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

The ROI from investing in real estate just seems to be the best option.

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

Searching on zillow/redfin for many months until we found a home that was in our price range and both my wife and I could see potential for updates.

How did you finance this deal?

We saved up a down payment and got a 30 year conventional mortgage.

How did you add value to the deal?

We took out a wall which dramatically opened up the kitchen to instantly make the home more open and modern. Updated the kitchen with new counters, cabinets, electrical, appliances. And new flooring throughout. Because the home is only 900 sq ft, and we have become very handy, we were able to do all the work ourselves.

What was the outcome?

The updates (and location) allowed us to easily find a renter. It has positive cash flow with a very low interest rate, despite it being a non-owner occupied loan.

Lessons learned? Challenges?

Nicer property is easier to rent