Age 23, bought my first property with 6% down

[Kevin Bellavance]

Hi all!

Just want first to thank Biggerpockets. These podcasts (which are so down to earth compared to those self-proclaimed guru's **BS** out there) have played a large role in keeping me motivated for the last two years when I really wanted to get into real estate but couldn't due to student life, lack of stable job, minimum wage, etc.

Anyway, fast forward a couple years, a diploma and a good job later, I just closed on my first apartment building. Here are the details :

-7 units, gross rent for 37K year. Net income of around 17K after operating expenses, maintenance, management and vacancy are accounted for. 

-Paid 375K, appraised at 400K on day 1.

-Seller financing over 5 years for 70K, 4%. Interest only over the 5 year term.

-Bank mortgage for 282K

-Cash needed out of my pocket : 23K + 3K in acquisition fees. Around 26K total. 

Total estimated ROI for year 1 (net income after interest expenses/cashdown) : 60%

I really hope everything goes as planned. I still have a few repairs to do on the building (obviously it's not new), but overall a good building in my opinion (also reassured myself with a good inspection pre-acquisition). 

So, that's it. Just wanted to share my first property story. Nothing compared to some of you who have had much more impressive beginnings but maybe if I can motivate a few beginners out there, then I'm happy with it. 

My advice : 

I've had analysis-paralysis for way too long and it amounted to nothing but stagnation. So, take a deep breath, take calculated risk and go all in. Just don't suck at maths :^) !

Now, on to doubling my asset within the next year!

Cheers!

[Kevin Bellavance]

@Steve Vaughan Hi Steve! Thanks for the positive feedback!! I don't have a commercial loan. It was done via the ''personal'' branch of the bank. Same kind of loan as for a house. My next one will have to be a commercial loan. Currently, rate is locked below 3% for 59 months. I, however, do not plan on paying my mortgage aggressively as I want to maximize use of leverage to acquire more properties. In Canada, we have a pretty stable economy and interest rate environment, fortunately. 

Cheers!