House Hacking a Single Family

[Matt I.]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $159,000
Cash invested: $10,000

Contributors:
Steven Primiano

purchased my first home using a first time home buyer program from a notable bank (3% down, but this isn't an FHA). This 2 bedroom 1 bath is located in a C/B class turning A area on the edge of Fishtown, Philadelphia. I am owner occupying the residence and renting out one of the rooms to a friend from college. currently I am -$500 a month but it beats the prices for most local rents around here. I am slowly making improvements to eventually rent out full time, so I can move on to the next one.

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

Eager to get into my first property, I couldn't afford anything in the NJ market (where I was living with my parents). Property taxes are impractically high and Multi families in relative proximity to my job were rare. I was working with a great agent, but eventually we both realized I was looking in the wrong place.

I had recently graduated college in Philadelphia before moving back home, and made the decision to look in 'up and coming' parts of town that were more affordable than NJ.

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

I was able to negotiate from an asking price of $200,000 down to $159,000. My background in architectural design definitely helped along the way, as I was able to spot thermal enclosure issues which I then pointed out to the inspector.

How did you finance this deal?

First time home buyer conventional mortgage (not FHA)

How did you add value to the deal?

Replace existing carpet with high end pergo
Renovate upstairs bathroom with the intent of adding a half bath to the basement
Other misc repairs and upgrades are planned for future phases of work

Lessons learned? Challenges?

The biggest challenge is moving on to the next deal. Since this is somewhat of an ongoing project, the house isn't exactly making me money yet. I'm a pretty frugal person, but my biggest challenge would be pursuing the conventional route of investing - saving. I'm currently exploring other creative ways and am open to the idea of partnering for a future deal. Skills of value that I could offer would be architectural planning, design, 3d rendering, surveying, and of course hustle.

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

Steve Primiano is a fantasic central NJ based real estate agent and I would recommend his services any time. Great guy with a hard hustle, and fun to kick back and have a drink with.

[Ryan D.]

Congrats @Matt I.! Are you in the Norris Square area? I'm working on a 4b SFH in Fishtown right now in the Adaire catchment. Doing a similar rent hack with my best friend paying $500/m to live in the construction zone we're currently calling home. I'll be BRRRRing this and will be using it as an Airbnb long-term.