Our First Investment Property!

[Travis Olszewski]

Investment Info:

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

Purchase price: $200,000
Cash invested: $70,000

Wife and I finally pulled the trigger on this duplex. Paid market value however the property is under performing. Condition of one side is not up to current standards for market and rents are below market value. Goal is to do full renovation of the one unit and outside as needed. Should be ideal for BRRRR strategy.

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

Underperforming rental income and needing to be updated. Worst house in neighborhood.

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

Through Realtor.com. My realtor is a super communicator which won the bid when ours was basically the same as the other party’s.

How did you finance this deal?

15/30 balloon conventional through local credit union.

How did you add value to the deal?

Will be updating one side entirely, doing 90% of the work myself.

What was the outcome?

We shall see

Lessons learned? Challenges?

TBD

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

Yes. Kameron & Kristy Morris service SW Michigan. Best in the area!

[Travis Olszewski]

Hi Landon, 

What I do/doing is talking to local investors to get an idea of what they are renting property for. The key though is knowing your market. For example the property I purchase, rent for the one side was only $700, the other $950 (updated side). Talking with local investors, completely renoed unit should go for at least $1,100. 

The unit that is not updated, I've already done significant upgrades like flooring, new trim, doors, appliances and current tenant accepted my increase to $850/MO. Luckily they have been accommodating and wanting the updates and willing to pay more for those... so far.