Steal of the Year - Instant Equity

[David Moore]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $61,000
Cash invested: $17,000

This is my steal of the year...got this in a sleepy summer market. 3 bed/2 bath in really nice neighborhood. Seller had started for sale at $89K. House has a couple oddities...upstairs bathroom barely 6 feet 6 inches height. No garage, but off street parking. We are putting about 2K into it, and locked a renter in for 18 months at $1100.00 a month. Just loving this one. My banker was thrilled...they said their appraisal came in at $106K, meaning I have over 50% equity day one. Wow, just wow! We will add central air and new furnace, and electrical panel in 2024 or 2025...so some upgrades needed, none urgent.

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

We had been monitoring this property, negoatiating with the seller over a period of weeks.

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

Our MLS Agent, and on realtor.com. This property had a couple small oddities about it, and I was quite surprised it sat on the market. We held firm at 61K, and even were told our bid was outdone by another buyer. That buyer cancelled contract on the inspection report. Asbestos fear can be a great friend. The inspection report, which our agent got us, said ceiling tile could be asbestos. We have an asbestos contact, who told me what to look for in tiles. We learned they had zero asbestos

How did you finance this deal?

Our local lender, MBT bank. We had to put 25% down, but the lender included the closing costs.

How did you add value to the deal?

We repaired from step and rail, and replaced downstairs toilet and shower. We also repaired some gas lines. We will be adding upgraded electric, and heath/central air in the future, but no need to now.

What was the outcome?

We got a great renter, thank you Lord, for $1100.00 a month for 18 months

Lessons learned? Challenges?

If you have a crappy acquisition, the next one can be a gold mine....keep looking, keep praying, keep trusting.