First investment property purchase and lessons learned

[Kevin Bieber]

Hey guys-

Just got through with purchasing my first investment property in Arizona. Picked up a condo in central phoenix and so far things are going well. Wanted to put up my numbers/lessons learned and see if anyone else has properties near central phoenix. Plan is to hold and use it as a cash flow property. I will definitely sell if it appreciates enough , but not banking on that.

Purchase Price 148,000

Cap Rate (includes hoa vacancy insurance etc etc) 7%

Rent per month - $1220

Closed on it last month and it will be rented to tenants within 2 days. Excited to get things rolling and learned a lot throughout the process.

Lesson 1-

No buying Agent-

My original buying agent turned me onto the condo complex which was great. But later on when we found one come up for sale, he called and said it was a good deal so he was going to place a bid on it. I of course let him go shortly after and continued the process on my own. What i found was that in the hot az market, leaving a buyers realtor out of my purchases seemed to give me a competitive advantage. Prior to this purchase i had bid (sometimes over list ) on many properties with my buying realtor. This time i went direct to the selling realtor and took her recommended buying realtor. I put an offer in with her and it was accepted (slightly under list). I think giving her the option to run the entire deal or recommend her own buying realtor really made the difference in the purchase.

Lesson 2-

I want to avoid dealing with a bank for my next place. It's a major pain and takes away bargaining power IMO. Going to try to put together cash myself for next one or get private loans.

Lesson 3

Using electronic forms (cozy.co) for application/screening etc was well worth it. Made the process really easy. In the future, I plan to get the lease on docusign as well.

Above about sums it up, of course any feedback or thoughts are always welcomed.  Tenants move in tomorrow!

[Kevin Bieber]

Thanks Guys!

Alex, HOA is $140 a month and it's in Phoenix. I used a combination of Craiglsist and Zillow to find tenants. Zillow turned up a lot more leads than Craigslist (Zillow syndicates them to other sites). In addition, it provided a quick blurb on each perspective applicant which was helpful.

Then i schedule a few showings and after showing, I had them put in applications (i may reverse this order next time but worked well for me).  Applications were submitted using cozy and this worked awesome.  After reviewing applicants I asked one of the perspectives to pay for the credit and background check provided by cozy.  They passed that and then i called on their previous housing references who all checked out.  So far so good and I am using cozy for rent collection/security deposit as well.  Tenants moved in 3 days ago.

One thing i didn't do was to ask for paystubs from their current jobs, I would likely do that in the future.

Thanks,

Kevin