Newbie Success Story: I "accidentally" bought first rental home!

[Peter Zora]

Hi Everyone, 

I've been a lurker on BP for while, hoping to get into flips and rehabs in the Southeastern Michigan market. My brother and some of his friends have had some success flipping in the last few years and I was beginning to feel left out. :)

I decided to finally take the plunge and start looking for a deal. An investor I know was liquidating a lot of his holdings since he's trying to retire soon, so I convinced him to sell me a property on land contract because I wasn't going to qualify for a traditional loan, and I only had a little bit of money saved up to work with. 

The house was disgusting when I bought it. A fairly new home that was built in 2007, but the previous tenants had pets that they never let out to use the bathroom, and kids that liked to color on walls, etc. 

I made some mistakes, and clearly I bought too high for me to flip this property (we live and we learn). A lot of people were trying to convince me to back out and take a loss on the deal before things got out of control - especially my dad. I don't have a lot of support in this area, and no experienced mentors at this point, so the bombardment of negativity made this entire process especially difficult for me. All a mental game. 

I decided to keep the property, rehab it as best I could, and find a good tenant. A friend of mine suggested I search for Adult Foster Care Home companies in the area because he thought the layout of the house was perfect for it. So I jumped on google and searched for these companies and spent a day calling a bunch of them. Surprisingly that was all it took. I found a company that was in the midst of expansion and was interested in looking at the house. 

After doing my due diligence on the company, we worked out a two year lease to start off our new business relationship. So far they have been great, and they even helped with some of the rehab work too. I'm now leasing the property to them for $1200/month which is a lot more than I would have ever gotten from a traditional tenant. 

So, there it is. My first rental property that I bought accidentally. Does anyone have any experience in working with Adult Foster Care Home companies? I would love to hear your stories.