Great Rental in Savannah Georgia! Purchase Price $4500

[Curtis Bellenot]

Hi my name is Curtis Bellenot and I recently completed an awesome project in Savannah, GA.

Quick run down is: 3/1, 1300 sq/ft, brick, ranch style home.

Purchase Price: $4,500

Rehab: $13,500

Misc Expenses: $1,500

Total: $19,500

Rental income: $850 a month

To give you some back story, I bought my first rental in 2013 in El Paso, TX while I was stationed at Ft. Bliss, fast forward 3 years and I was living in Savannah, GA flipping houses and making enough money to get out of the Army. I've done 10 deals now, some flips, wholesales and rentals, building some pretty good contacts and relationships along the way. This deal came out of a wholesaler friend who doesn't like to go to "this part of town" and told me the seller wanted to sell his house for 5-7k. I gave a quick call, at 2pm and the seller said it was a 3/1 didn't know the Sq/Ft, hadn't lived in the house, but needed money to fund his other business so I made an appointment to see the house at 6pm, had it under contract for $4,500 at 6:30pm. When the deal is good, you need to move fast. 

So here is the property on a map, its right next to an Army base, which is usually a lower end area, its on a busy street, so for 5-7k I'm expecting a real piece of crap. I do a quick property record search and then look for recent sales and am blown away! 

The red dot is the subject property, less than an 1/8 mile away there is a 3/2 that has sold for 114k!!! 

And here's the property record file photo! This is gonna be great! All brick construction, roof looks good, new windows, cute curb appeal for this style of home. As long as the electrical and plumbing are good I can do a full rehab on this and still come out ahead. My exit strategy here is to flip it or maybe rent it out, both look good and if you have multiple viable exit strategies you are in a good place. 

The A/C line was cut, and the house has been vacant for about a year, so the inner part of the old unit is probably totally corroded (its hot and humid here) so add that to the budget, about 4k.

Tile in the kitchen, stripped floors and the drywall looks in good shape.

Bedrooms all look pretty good, (except where they ripped out the A/C line for $5 worth of copper....) and this guy wants 5-7k?! Oh, here's the issue in the laundry room... 

and the ceiling 

So it needed some drywall and we have a leak somewhere... 

Kitchen looked good though 

And hallway between kitchen and den, there was some work done at some point...

So first Red Flags were a giant leak in the laundry room ceiling causing the drywall to be torn down, water is not turned on, so plumbing might need to be entirely redone (quickcrete in the plumbing). The wiring looks good, but the power is off so budget for that as well. A/C is scrap, so a new condensor and maybe a new air handler/furnace. So worst case would be about 35k repair, but if we get lucky maybe 12k or so to do the entire house. So I offered the seller 3k, he didn't say anything, I let the silence do the work, he said 6, I said no way, and went back out to the A/C and he cam down to 5, I went to 4. He sat at 5 for a bit and so I said how about 4,500 and we can close as soon as my lawyer does the title search, he signed my contract and 12 days later the house was mine (and the wholesaler received $500 for the phone call, I like to take care of people who take care of me).

The after pictures: 

Kitchen came out great, we used grout refresh to stain the grout, the appliances were $900 for Fridge, Stove, Microwave, Washer and Dryer from a local "Scratch and Dent" used appliance place.

Laundry room fixed, painted with used appliances! 

This deal was a home run any way you look at it. It was dirt cheap, I put everything on a credit card (even the house purchase with balance transfer checks). The colors were simple Navajo white, cheap dark laminate flooring, light blue in the the bathroom, new fixtures, new water heater, new A/C so that the main systems are good and I don't have to worry about them for awhile. While I was getting this one ready I put a bunch of signs "We Buy Houses" in the front yard and I got a signed lease and deposit before we were even finished. So with a Cap rate of 52%, a good tenant, I'll be keeping this one, refinancing it, and looking for more great deals in this neighborhood that is NOT a warzone but a good working class area.

Feel free to shoot me any questions or comments. 

-Curtis Bellenot