First Investment- Buy and Hold SFH

[Laura Dawson]

Investment Info:

Single-family residence buy & hold investment in Springfield.

Purchase price: $37,500
Cash invested: $35,000

3 bed, 1 bath craftsman home located walking distance to down town and university (10-15 min walk)

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

This was my first deal and I think it was a combination of some luck and interest in dabbling in RE.

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

I found it on the MLS for 45,000 and thought I'd offer 30,000. When they countered for just under 40 (which my agent thought was a good deal) I decided to split the difference and they accepted.

How did you finance this deal?

Cash

How did you add value to the deal?

Complete remodel. Gutted the bathroom, expanded the kitchen, knocked out a wall, added two closets. It was listed as a 2/1, so made the front room a third bedroom.

What was the outcome?

I currently have the house rented in a year long lease.

Lessons learned? Challenges?

I learned so much on this deal. First, I learned how to analyze a deal on this house and while I ran all the numbers (this was before I new about BP) I don't think I fully grasped the concepts. The second thing I learned was how to remodel, including demo, working with contractors for the things I couldn't do, like some plumbing and electrical, and general home ownership things such as taxes and basic maintenance. And currently, I'm learning how to manage property managers.