2015 House Hack about to turn into huge cash out profit and airbnb income

[Zach Matson]

Investment Info:

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

Purchase price: $165,000
Cash invested: $50,000

4 bedroom home with a 1 bedroom apartment attached. Originally bought as a house hack. Currently live in and work out of, but will be moving out this year and renting both units as short term rentals.

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

Originally back in 2015 I was looking for a 2nd duplex that I could house hack and live in one unit while the other unit paid the mortgage. This one didn't quite do that, but the 1 bedroom apartment paid half the mortgage while I lived in the 4 bedroom house for $500 a month and fixed it up. I knew once it was fixed up and both units rented it could cashflow over $1000 a month.

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

On the MLS back in 2015, used an agent, before I was licensed myself.

How did you finance this deal?

Conventional Mortgage 5% down and 4% interest rate.

How did you add value to the deal?

Renovated it.

What was the outcome?

I ended up living here longer because I got into real estate full time and didn't have the energy to finish fixing up, but moved out a couple months ago and it's almost ready to rent out as 2 units for Airbnb's or mid-term. I'm currently doing a cash out refinance and taking about $300k in equity while leaving equity on the table still so that it cashflows whether it's rented out long term, or as an a short term.

Lessons learned? Challenges?

This was a really good buy back then and super glad I took the risk, even though I lost my job 3 months after buying. Still made it work and has been a good investment and the value skyrocketed. I'm now taking out cash and funding the rest of the fix up, as well as going to gain significant cash flow.