Closed on two new deals Wednesday!

[Greg Gaudet]

Investment Info:

buy & hold investment in Kahului.

Purchase price: $97,000
Cash invested: $4,000

Purchased foreclosure at the Commissioners auction (sheriff's sale) for $97k. Planning to put 4-5k into rehab for an ARV of about 140k and plan to have rehab done in a week and tenant moved in at $1,700/month which will produce about $500 cash flow.

Bought this deal with a partner. She wrote the check for 104k total, I brought the deal by always staying on top of the auctions, I handled the eviction process of the non-paying previous tenants, coordinated and managed the rehab, and will manage the rental for a 50/50 split of all cash flow and any equity earned beyond her 104k investment.

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

Cash flow and my knowledge of this market.

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

I follow the local sheriff sales very closely so I always know what's coming up. Bidding started at 86k, 5 other bidders took it up to 97k and I won it.

How did you finance this deal?

I had all my cash into other deals, so I mentioned this deal at the Maui REI meetup and another member said she had 100k to invest but didn't want to do the work, so we partnered. She wrote a check for 104k for purchase, closing costs and rehab and I managed the acquisition, rehab, and rental.

How did you add value to the deal?

Removing the previous tenants that hadn't paid rent or electric in years, new floors, new vanities, new toilets, cleaning the cabinets and shower to make them look new again and repairing all electric, windows, etc.

What was the outcome?

In the middle of rehab now. Will post pics once it's done. But I haven't even advertised the rental yet and I have a veteran single father with section 8 benefits that is very interested and will most likely be renting to him. We're really happy to be proving a home to a veteran and single parent in need.

Lessons learned? Challenges?

Don't do this if you don't like working.

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

Nope, just me and my partner. Although I always use Twyla Kukahiko at Title Guaranty for all of my escrows. She kills it. And our contractor Casey Cleary.