SFR Investment property purchased for the garage

[Gabriel Perez]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $70,000
Cash invested: $15,950

Small SFR with large garage. SFR has foundation issues but the property was purchased for the garage. The numbers showed that the rent for the home would provide at least $126/month in cashflow, and the 12 month plan is to convert the garage into a 2-3 bedroom home the pro forma rent to be around $900. After a year the goal is to refinance to a debt service of $500/month, and gross income of $1,700/month

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

Saw it as a longterm play to own two doors at the all-in cost of around $130,000

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

Zillow saved search criteria

How did you finance this deal?

Hard money loan for the down payment, commercial loan at 9.25%. Plan is to refinance into a residential mortgage at a lower interest rate

How did you add value to the deal?

Convert the garage into an additional unit (2-3 bedroom)

What was the outcome?

Still in-progress, SFR has been closed on, currently making ready for renting out. Once Spring comes along, might begin the garage conversion.

Lessons learned? Challenges?

Having more dry powder for when opportunities pop up.