First multi-family investment

[Jason Skinner]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $110,000
Cash invested: $25,000

Own and manage the property

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

Having multiple units to help mitigate a vacancy and still pay expenses is what drew me to this type of investment.

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

I looked at the MLS every day searching the state of Michigan with a filter to only look at multi-family. I was looking to do a conventional deal with 20% down so I needed to be in the $100k price range. I ended up using hard-money to make the purchase, financed in my LLC.

How did you finance this deal?

Hard money lender 80/20, 30 year fixed rate.

How did you add value to the deal?

No value adds, just equity. Did raise rents 1 time since purchase.

What was the outcome?

This is a buy and hold play, all 3 units were full at acquisition and still have the same tenants. I will have owned it 2 years in April 2024, purchased for $110k and is now worth $160k just from appreciation.

Lessons learned? Challenges?

The challenges I have realized is keeping all the tenants from getting annoyed with each other, I try to make them work it out on their own and always provide alternate viewpoints for them to consider.

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

Mikal Gabler with Kellar Williams was my buyer agent. His office is in Fenton, MI.