VA Multi with an AirBnB Twist

[Daniel Kidd]

Investment Info:

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

Purchase price: $263,000
Cash invested: $1,700
Sale price: $292,000

This was one that I had been waiting for since I had started looking into real estate at all. Being Military and having access to the VA loan I was eager to maximize the benefits of this loan and really kick off my investment career. The List price was 292,000 and I knew that it would appraise around $255K so I bid $293K and won the bid. After waiting for the appraisal to come in and getting the seller to drop to the $255K appraisal I then went used the inspection to get about 30K in repairs and concessions for repairs for the property. This enabled me to make everything rent ready after about a month of rehab for only $7,000 of it our of pocket. On this one I had a few issues with current tenants breaking all of the doors as the left and some not paying the last month of rent and things like that but in the end it worked out because they did not provide a follow on address or ask for their deposit.

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

I had been looking for a quad for a while to maximize the effectiveness of the VA loan

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

This was an MLS deal and I bid over list knowing that the appraisal would come in low.

How did you finance this deal?

VA Loan

How did you add value to the deal?

I did extensive rehab and increased all of the rents by $150/door. I also opened one of the units for AirBnB and that has made it higher performing that the other units by about 150%.

What was the outcome?

This is easily one of my highest producing assets at the moment. It needs very little to keep moving

Lessons learned? Challenges?

Always get your deposits at closing. This was such a pain to track down later. Let inherited tenants go without a fight and just be done with them and move forward. Landscaping is one cost I will remember to pay for quality on. The cheaper landscaper destroyed my front yard and charged me a lot to do it. Always look up and assess if you will need tree removal.

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

Shelby Osborne - Agent and Team lead for Five Pillars Realty, She was my agent before I became one.
Patrick Stoy - Lender
Stephanie Foley - Insurance
Jennifer Kirby Fincher - Closing Attorney