Our First Investment Property

[Dan Kurtz]

Investment Info:

Single-family residence buy & hold investment in Wellington.

Purchase price: $204,000
Cash invested: $40,800

This is our first rental buy & hold property we invested in back in April of 2019.

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

My wife and I knew we wanted to invest in our futures starting in residential real estate. This seemed like a good price point for entry into the market so we started with this deal.

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

This deal kind of fell in my lap. My co-worker's mother was being moved to a nursing home and they said they were planning on selling the house so that their mother would be able to move into the nicer place. The deal was that they had to sell the house and as long as all the proceeds went to paying for the nursing home she would be able to stay in that home for the rest of her life.

How did you finance this deal?

We financed this deal with a traditional 30-yr home loan with 20% down. My wife an I had been saving well over 70% of our income per month to start our investment future.

How did you add value to the deal?

When we purchased the home we started with the flooring and paint. The floors needed leveling so was the first thing we did. After leveling the floors we installed Life Proof floors which I cant say are "Life Proof". After the floors were installed we did a full interior paint job. We have also replaced the washer and dryer, did some tile work in the bathroom around the vanity. We refinished the shower with a Tub & Tile kit.

What was the outcome?

Outcome has been wonderful. The house has been rented at 95% since the property has been put in service. Every year the property appreciation has done very well. Rents have increased dramatically in the last 3 years making this property a really great first rental.

Lessons learned? Challenges?

When hiring a company to do floors make sure you ask them any reason the floor would not be under warranty. The guy that came and installed the floor failed to tell us that we were required to install new thresholds at the entrances of the home in the front and the back. Due to this failed communication over the first 2 years of use the floor failed by the front and back door due to moisture getting under the floor where the tenants tracked in snow.