Topsail Area Long-Term Rental

[Jonny Provost]

Investment Info:

Single-family residence buy & hold investment in Topsail.

Purchase price: $298,000
Cash invested: $15,000

My wife bought and renovated our first family residence with the intention of it being a long-term rental for us when we buy our next property. Our property is 8 minutes to Topsail Island, 45 minutes to Wilmington and 30 minutes to Camp Lejeune. We put in new floors, resurfaced the stipple ceilings, and painted all the walls and trim. We have also added french doors to the office, a paver patio outback, and some new finishes on cabinets.

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

We wanted to get under contract on a property that could bring cash flow down the road. We didn't have enough capital to get a short-term rental in our market, but the long-term market is strong here as well, so we bought our home with the intention of it becoming a long-term rental when we move out.

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

My wife and I looked for months for the right opportunity, and when this one popped up on the market, we had to be one of the first ones to see it. It is a 3 bed 2 bath and has a flex space that could be used as an office. Two factors that stood out to us was a beautiful willow tree outback and an open concept living area. This property couldn't have a better location and its charm was evident. We put a the first offer in and got the sellers to cancel weekend showings, so there was no bid war.

How did you finance this deal?

We put 3.5% down on a conventional loan. We intend to do a free refi by the end of 2024 with a better interest rate and more equity in the home.

How did you add value to the deal?

We turned a dark dingy home in a bright and airy coastal oasis.

What was the outcome?

Our house is a beautiful coastal oasis now. Our plan is to rent it out with monthly cash flow over $300 once we are able to find our next residence.

Lessons learned? Challenges?

We did most of the renovation ourselves, but there were few things we contracted out which were more expensive than we imagined. It was good to get a taste of how expensive items (ex. LVP) can be and why it's important to budget out with a buffer in mind. We also bought at high interest rates, which was painful, but the kicker was insurance costs near the coast.

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

I'd highly recommend Shaun Utterson as a lender in Wilmington.