My first Detroit Land Bank Rental Property

[Dominic Rosso]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $1,100
Cash invested: $30,000

I was the only one who bid on this place, which sounds like a red flag but i decided to stick with it and take a chance. At first they said the water main was cut which could cost up to 10k to repair, but we dug up the stop box and turned it on and the water was still flowing to the house, so we saved a ton of money finding out that wasn't true. After taking out a home improvement loan we now get $1000 per month from this rental home.

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

My wife and I wanted to buy these cheap houses and fix them up and use the rental money to pay for the loan as well as extra income for us.

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

Kept checking the Detroit Land Bank until i found a house that looked in decent shape, put in a bid, i was the only one, so i got the house without issue.

How did you finance this deal?

Took out a home improvement loan of 30k from lightstream.

How did you add value to the deal?

we added a bedroom in the basement, turning it from a 2 bed 1 bath, to a 3 bed 1 bath. We may decide later to add a half bathroom in the basement to add even more value.

What was the outcome?

well i would say we at least doubled our money if we chose to sell. $31,100 is the total cost, the house is estimated to be worth $80k.

Lessons learned? Challenges?

make sure the windows you buy are secured, someone got into the house by opening the windows and stole a bunch of stuff, about $2000 worth of stuff, a small set back but a lesson to make sure you check on your property and make sure your contractors lock up after they leave. Also try not to keep anything in there you don't want to risk getting stolen.

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

no