Updated almost 7 years ago on .
3 Family Cash Machine
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Johnson City.
Purchase price: $77,000
Cash invested: $23,000
Sale price: $92,000
3 unit house with a 2 bedroom 1 bath apartment on each floor. Bought with rents below market and invested some money to make minor improvements while raising rents over time to where they should be. I was Cashflowing $700/month for 5+ years before deciding to sell and roll that money into 1 or 2 additional houses. I walked away with $39k.
What made you interested in investing in this type of deal?
When I first started out i was obsessed with 3 unit houses for some reason
How did you find this deal and how did you negotiate it?
This was before I was an agent, I was 23 and working as an HVAC repairman and was fixing a furnace for this woman who happened to be a real estate agent and we just got talking and the next thing I know I'm buying I'm a house. Turns out the owners were moving to Puerto Rico for work and I got the house for a good price.
How did you finance this deal?
Not knowing any other way at the time I went to the bank and asked them If i could repay them for the next 30 years and to my surprise they gave me the money.
How did you add value to the deal?
Rents were way below market, and some deferred maintenance repairs
What was the outcome?
I cashflowed $700/month for 5+ years and walked away from closing with $39k
Lessons learned? Challenges?
Vacancies suck, keep good tenants!