Just closed on first rental!

[Charles Giovanniello]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $115,000

Cash invested: $38,000

Cash Flow: $400

COC ROI: 12.64%

This is my first Investment Property! I'm renting a 2 unit apartment to students in the Binghamton NY area. Located by the bus line available for students to take downtown or to the main campus.

I'm working with a property manager who was recommended by my agent. He seems nice and like he knows what he's doing. I'm entertaining the idea of managing it myself, however, I live ~4 hours away and this may not be feasible. If anyone has insight on managing remote, it would be greatly appreciated!

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

I wanted to invest in student housing in this area because of the high demand for housing. Also, properties in this area are quite affordable.

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

I found my agent through the forums on Bigger Pockets, who knew the student housing market very well. When i first went up in May, the seller wanted $140,000. This was too high and would not yield a good enough return. When i found out it was still on the market in September (After another deal fell through) i offered $105,000. We eventually negotiated to $115,000.

How did you finance this deal?

Conventional loan, money saved from working and other investments from inheritance.
Chase Mortgage, 6.25% interest, 30 year loan, 25% down. (Couldn't do 20% because it was a multi family)

Lessons learned? Challenges?

I learned about the process of buying real estate. The biggest challenge was finding a deal that worked. I went under contract for one house, but decided not to follow through after inspection due to the condition of the house. I should have more thoroughly walked that house before making an offer and paying for inspection. However, the whole process overall, from first calling the agent, to closing last week was extremely valuable.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Charlie Ackerman (fantastic agent in the area, knows student market well). Gary Klein (Attorney, very knowledgeable and meticulous in his work).