VA Loan - First Buy & Hold Property

[Tyler Hall]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $250,000
Cash invested: $5,000

This was a property my wife and I purchased to live in while fixing it up with the idea of renting it out. We found this property had good bones and bad pictures on Zillow. This caused it to get less traction as other homes at the same size. We were able to work with the sellers since they were going through tough times and wanted to get out of the house quickly. We knew at the price the house would cash flow, then the house market went crazy and rental prices went up tremendously and the appreciated sky rocketed so this is going to be an amazing first property for our portfolio.

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

My wife and I want to build a build and hold portfolio. We ran numbers on a lot of properties but were strict on finding one that work. Once we found this one we knew it would be the perfect property to make our first investment while we also lived in it. We knew we could increase the value day one with some basic cosmetic updates.

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

We found it on Zillow, notified our real estate agent we were interested. We found out the sellers were highly motivated due to personal problems so we were able to negotiate some of the closing and we able to get into this house with little down.

How did you finance this deal?

We utilized the VA loan, so we paid all of the fees associated with that and then paid roughly $3500 for closing.

How did you add value to the deal?

We looked at other houses with the same specs that were for rent in the area. We were also looking at a TON of houses in the area so we knew this house was under what it should have costed. From running so many comps we knew we could either break even day 1 or cash flow a little.

What was the outcome?

The housing market went crazy the house appreciated a ton and the rental market increased tremendously allowing us to cash flow a lot more after all expenses are paid.