Lexington, KY House Hack by W. Sixth

[Corey Griffo]

Investment Info:

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

Purchase price: $213,500
Cash invested: $42,700

This Duplex was the very first property I purchased when coming back into the area. It is located in what was a transitioning neighborhood that was seeing quite a bit of value climb since the West Sixth Brewery moved in a few years before spurring investment of the beautiful but rough neighborhoods around it. At the time of purchase, the neighborhood had turned about 40%. The plan was to house hack it, living in one side while personally fixing up the other to rent out. It was in need of quite the facelift both on the interior and exterior. Purchasing it for $234,000 on a owner occupant loan (80% LTV) the 30 Year Ammortization I would eventually learn would really make this properties cashflow special. I immediately took out a HELOC from a local Credit Union up to 95% LTV to assist me with all of the renovation costs which turned out to be around $45K.

This was the property that helped me learn to outsource work. I ran myself ragged renovating the first unit by myself as I worked full time in another city at the same time. Once the first one was completed, I vowed never to put myself through that again and hired a contractor I found through another investor down the street. It was the single best decision I have made in my investing career. Their work was better and because they no longer had me as the bottle neck it was done faster essentially allowing me to get a renter in months sooner than I would have otherwise offsetting the costs of hiring the contractors.

ARV on this property was appraised at $330,000 and rents are $1100/unit.

Equity gained - $71,500
ROI - 22.4%