Buy and Hold Investment Property

[Jack Ropp]

Investment Info:

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

Purchase price: $86,000
Cash invested: $6,000

Up and down duplex - 2/1 & 2/1 - 1800 sq ft. (800 top) (1000 bottom)
$700 Top $800 Bottom - $1,500 Gross Profit

$767 PITI
$250 Avg. Utilities (pd by landlord)
10% Capex (1,500 x .10) = $150
7% Vacancy (1,500 x .07) = $105
Total = $1,272

$1,500 - $1,272 = $228 cash flow.
These were the numbers I ran before purchasing the property. Slim margins with the plan to slowly increase rent as I am below the market average in my specific area.

This has been a tremendous learning experience as this is the first investment I have ever purchased. I want to continue to invest with my next goal to partner with someone and purchase a small commercial property. Ideally something between 5 - 24 units.

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

The surrounding area and BRRRR strategy.

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

MLS negotiated down 6K.

How did you finance this deal?

Conventional Loan

How did you add value to the deal?

Sweat equity convincing friends to come help do general repairs and landscaping.

What was the outcome?

Still, own the property.

Lessons learned? Challenges?

Really get your numbers straight and have a solid plan going in.

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

Yes, I work with a realtor.