Duplex in CA, cash flow positive

[Kayla Elliott]

Investment Info:

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

Purchase price: $655,000
Cash invested: $170,000

Purchased for $655k, we are building a duplex in the backyard as the house is zoned R2. Rear unit should rent for $3,000 (1k per room) and we are house hacking the main house ($800x2 they are friends so we give them a $200 discount on rent a month) to cashflow positive $450 even as we live in the main house. Who says CA REI isn't possible?

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

We were looking for ways to make money in California by adding value to a normal property.

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

We found this deal on the MLS and was the second place offer that after the first position offer was accepted and fell through, we were ultimately selected.

How did you finance this deal?

US Bank has a loan that includes construction costs into the mortgage.

How did you add value to the deal?

We are spending $170k to add a second unit in the back yard and we are house hacking the main house.