Your Best Deal Ever

[Peter Sanchez]

I was listening to another podcast, which i won't name and one of them asks his guests about their best real estate deal.  Mine was my first.  I moved to DC in 2000 and got a job at a law firm and looked at buying a condo.  At the time, DC had a first time homebuyer tax credit of up to $7K.  It varied by income and disappeared completely if you made more than 80k/year.  Since I started working in September (prior to that I was a student with $0 income) I would qualify for the full amount that year, and nothing the following year.  So I looked at tons of places and bought a studio for $70k.  I closed a few days before the end of year, right under the wire.  

So I put 10% down. Which is $7k, but I got it back a few months later because of the tax credit, so it was like doing a nothing down deal.  So 70k-7k means my cost basis was 63k. 

By pure luck, this was the beginning of the housing bubble in DC.  I sold it 3 years later for $210k.  AND  since it was my primary residence, all the appreciation was tax free.  I think I spent about $5k to retile the bathroom, but nothing else.  

What about your best real estate investment ever?  

[J Scott]

First deal was the best...

Overpaid, went way over budget, did a horrible rehab, had to lease-purchase it for 2.5 years, then had to do another rehab and ultimately make a $3K profit after about 3 years with $100K of my own cash invested the whole time.

The reason it was my best deal is that I learned enough that the next 100+ projects were easier, faster, less stressful and more profitable...