First properties not located in Utah

[Amy Kendall]

Investment Info:

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

Purchase price: $350,000
Cash invested: $5,250

These are two brand new duplexes. They are our first investments out of state. Each unit rents for $900/month. We just closed on them and we already had leases signed on 3 of the units. This will be the single largest addition in cash flow to our portfolio so far.

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

The numbers were more appealing than our local market

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

A local friend put us in contact with the builder about potentially investing in a different deal. We weren't too interested in that, but then he mentioned he had these two duplexes he was in the process of building. He originally wanted $400,000, which we passed on, but then he came back later with a $350,000 offer.

How did you finance this deal?

We financed it with a 15% down payment loan

What was the outcome?

We are just getting started. Time will tell.

Lessons learned? Challenges?

We did release $20k in earnest money to help finish the project, which required some trust on our part with a builder we have little relationship with. There were some delays in the construction process, which set the completion date back. All in all though, it went as smooth as expected for our first out of state deal.

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

We worked a lot with MACU as our lender. There were some hiccups as usual in the underwriting process, but we overcame them. It was an off market deal, so there weren't too many other professionals involved.