BRRRRR - SFH Property

[Tara Kinney]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $77,100
Cash invested: $6,900

Single family home. Scope of work to upgrade unit, needed to drywall and paint the entry way, put on new molding, tore up old carpet in dining room and living room and put down vinyl hardwood flooring. Financing - financed the purchase price through a private lender at 2 points and 9%. Used a 0% credit card to finance the rehab. Leased out for $1350 per month. Plan to refinance to get both the purchase price and the rehab costs out. ARV should come in around $120K.

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

Rehab was almost completely done for me, great location, previous owner left the rest of the rehab supplies. Easy flip and rent.

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

Brought to me from a wholesaler. Negotiated for $80K if seller would pay closing costs, $77K if I would pay closing costs. Seller chose the $77K.

How did you finance this deal?

Used a private lender. Found by being friends in a different circle and got talking about real estate. Learned he is a real estate developer and he also does some private lending. Was going to do hard money lending, but when he mentioned that, I asked if he would be interested in this project. Sent him all the info, and he jumped on it.

How did you add value to the deal?

Had to refinish the entry way, put new drywall up, paint the stairs, tore up the old carpet and put down vinyl hardwood flooring.

What was the outcome?

Leased out for $1350.00 per month.

Lessons learned? Challenges?

Took the contractors WAY longer than expected. Was told a week or two and it took 1.5 months. In the future, I plan to get that in writing and check in on them more, rather than relying on my property manager.

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

Alex Bock - he has wholesaled me two deals. Both have been profitable. His numbers a pretty realistic and negotiated price is fair.