Detroit duplex brought back from the dead.

[Marc Nischan]

Investment Info:

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

Purchase price: $12,000
Cash invested: $16,338

Rehabbed a vacant duplex in Detroit. Partnered with a property management company to do rehab and management.

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

I want to start a rental portfolio and found a house that I could afford.

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

I found it through a wholesaler I met at a local real estate meetup, the Renegade Detroit Meetup.

How did you finance this deal?

HELOC on primary residence :/

How did you add value to the deal?

This neighborhood has several vacant houses and I was able to take this one and make it a nice place for people to live. I would like to do more in this area. The house needed plumbing updates, and some kitchen rehab.

What was the outcome?

I was able to get in the game! It was a good first property experience for me, and I got help and encouragement from people I met through the meetups.

Lessons learned? Challenges?

I learned that things move more slowly and expensively than you think they will :) Also that I need to look for ways to raise capitol while building a portfolio, which means I'm looking for a few flips in the new year.

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

Yes, with Best Invest wholesalers and Investors Property Management Detroit.

[Marc Nischan]

Thanks Charles! Glad to answer your questions: The house dates to the 20s and had several generations of the same family in it - I bought it from a family member through a wholesaler. The flats are longish 2 bed 1 bath rectangles with a living room in the front, then dining room with a kitchen behind it on the left and the main bedroom (12x12?) and bath and on the right. Behind the bathroom are two small rooms that share a closet between. While there are technically three bedrooms, I couldn't really list it as a 3br because you have to walk through one back bedroom to get to the other.

I get 600 for the lower and 650 for the upper. I put just under 30K into it and it's probably not worth a heck of a lot more than that just because of the neighborhood, but from a cash perspective it is worth it as a rental. I'm going to see if I can leverage it in the coming year, but I'm not so sure I'll be able to because I'm self-employed and it's not a house that's worth a whole lot. I have heard that you need to have at least 60K in value before anyone will loan you anything on it. 

If you are interested in investing in Detroit you should check out bestinvestllc.com. They found this place and handle the property management.