Deal Diary - Hammy House #1

[Mark Larmeu]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $64,000

Our first investment is a 2bd1ba 1000sqft home in a fantastic location near downtown Hammond and Southeastern Louisiana University.
We plan to BRRRR it.
The renovations have been more extensive than we originally expected and we've done a ton of the work ourselves.
So far we've gutted the kitchen, bathroom, sunroom, and part of the back bedroom.
We had some foundation issues and replaced the roof also.
We're hoping for an ARV of around 110k and a monthly rent of around $1100 a month!

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

I'm a full time river boat pilot and like many people I want more time and passive income.
I've been interested in real estate for years so I partnered with my best friend and we dove right in.
He's been involved in construction since he was younger and he's been running a custom trim carpentry business with his dad for years.
Needless to say his experience has been invaluable!
We've hit some bumps in the road here and there as far as renovations but we've learned so much it's crazy!

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

MLS, negotiated back and forth with a real estate agent.

How did you finance this deal?

Conventional loan.

How did you add value to the deal?

At this point we've done almost a complete gut rehab.
New roof, floors, paint, total rehab on kitchen, bath, sunroom, and laundry area.
New doorways and bigger cased openings.

What was the outcome?

We haven't reached this point yet but we plan to rent it out and then refinance all of our initial investment (about 15k) plus the repairs we've put into it out, then roll that into deal number 2.

Lessons learned? Challenges?

Like they always say, get stuff in writing with your contractors!
But overall our experience has been great. We've done a lot of work ourselves and in the future the goal is to move away from that. Everyone says the main goal with your first deal is to learn and lay some solid groundwork if you plan to do this long term. I definitely think we've done that and I can't wait to start looking for number 2!

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

Shannon Babin with NOLA Lending is fantastic, I can't say enough good things about her. Also Petra Harper was a great agent for us!