Purchased using a 5% down conventional loan. I bought this home and lived in it with my family for a few years before moving and turning it into a rental. The cash flow is okay, it's not great, but the principal pay down on this loan is over $10k per year, and this is a great location, so the property value and rental rate will continue to appreciate over time.

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

I have used this strategy several times, I buy as a primary residence and keep it as a rental when I buy another house and move a few years later. This strategy only requires 5% down, so I save my cash for reserves and other investments and it gets me the lowest available interest rate. Living in the home with my family also ensures that it's in a great area and allows me to make small improvements while living there.

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

I found this deal on the MLS and paid market value, I even increased my offer to get a concession from the seller to reduce my cash out of pocket and buy my interest rate down. I have found that over time the location and the terms are the most important things, the price is also important, but the location and terms are more important.

How did you finance this deal?

5% down conventional loan with seller concessions to cover my closing costs and buy my rate down.

How did you add value to the deal?

I made a few small improvements to the landscaping, I bought a few new appliances, updated a few fixtures, added blinds to the windows, minor drywall repair/paint, and marketed the property as a 4th bedroom that would make great home office/den instead of a 3 bedroom plus office/den.

What was the outcome?

This is my 5th house in Gilbert and I plan to continue with this strategy until I get 10 houses.

Lessons learned? Challenges?

About a year or two ago I pivoted and started flipping and finding alternative strategies, but I have realized those cannot replace this strategy, they can be in addition to it, but I need to continue buying, moving, and keeping as a rental every couple of years because this really is the best strategy for building long term wealth.

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

I am an agent and property manager, so I represent myself and manage my own properties. I also love helping others, so please reach out if you have questions or if you want help.