First two Duplexes (4 units)

[Corey Reuter]

Investment Info:

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

Purchase price: $238,000

Cash invested including rehab: $65,000

Clean all brick 2 bed 1 bath duplexes in Independence with connected garages. Completed rehab on which introduced open concept kitchen, installed can lighting, interior and front door replacement, kitchen cabinet and appliances, bathroom update and interior painting. Outcome was better than anticipated and rents are higher than I expected :) Property came with new roof, AC, hot water, and furnaces.

Total rent in 4 units: $3,265

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

This property offered a value add opportunity and had room to increase rent prices.

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

I found this deal the day it was posted to the MLS. I organized a viewing of both duplexes next day where the realtor informed me that it was a very competitive scene with multiple cash offers already placed. To stand out from the crowd I asked the realtor to represent me as the buyer (needed someone in my corner) and wrote a letter to the seller explaining that I was a new investor and would care for the property.

How did you finance this deal?

Conventional loan - 20% down

How did you add value to the deal?

Opened and remodeled kitchen, new interior and exterior doors, can lights, paint, and updated the bathroom

What was the outcome?

Better than expected. I had both units rented before the remodel was complete. Rents are higher than anticipated. Confident I has solid, multi-year tenants

Lessons learned? Challenges?

I (help with friends and family) completed the remodel without contractors. The is a great cheap way to to learn the process but the time commitment wears on you. 2+ months of working my 8-5 desk job and then 5-11 remodel and 12 hour weekend days will wear on you and your relationships. I am nearing the end of this project and it was worth every moment I spent working.
I am worried about the cast iron piping that runs under the driveways, but am budgeting replacement to avoid surprises