First Investment Property

[Mike Wooster]

Investment Info:

Single-family residence buy & hold investment in Norfolk.

Purchase price: $115,000
Cash invested: $115,000

Single family, section 8, 99% government funded property with a long-term tenant. 2 bedroom, 1 bathroom house with detached garage.

What made you interested in investing in this type of deal?

The long-term tenant, the 99% government funded section 8 nature of the tenant, and the instant positive cashflow of $650-700 per month on a $1,000 rent. The comps are in the $120,000 to $130,000 range and the property needed no work (after the seller corrected everything found in the home inspection). Should give me the ability to mortgage the property in the future and get most of my cash out while still giving me a positive cashflow of $200 per month.

How did you find this deal and how did you negotiate it?

A customer of mine referred me to the listing agent. The listing agent knows the seller well and saw his goals and reasons for getting out of the property made him motivated. The agent also saw my desire for a stable cashflowing property. He made the connection and we went back and forth from that point to settle on a price that worked for everyone.

How did you finance this deal?

All cash purchase.

How did you add value to the deal?

Negotiated the price and pushed to get all repairs and improvements done by the seller prior to closing.

What was the outcome?

I own the property and have a solid cashflow with future ability to finance the property and get most of my initial investment out.

Lessons learned? Challenges?

This one was fairly straight forward. Prior to purchasing this property, I was not sure what type of property I wanted , I was not sure about the exact location I wanted to buy in, and I was not sure about the strategy I wanted to use... The challenge was learning that having a plan and path in-mind is crucial to getting to where you want to end-up!