Our First Home! A Multi-Family!

[Jose Rey]

Investment Info:

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

Purchase price: $120,000
Cash invested: $7,500

First house we ever bought! A brick ranch style home with a converted basement. Both top and bottom units are 2 bed 1 bath and have their own fully equipped kitchens. The only shared space is a laundry/storage room. The entire bottom unit needed renovations which I did my self over about a 2 month period while living in the top unit. While we lived there, the bottom rented for $600/mo. with the mortgage payment being only $800/mo. We have now relocated to SC and rent out the top unit as well for $750/mo. and the bottom unit at the same rate! Cash invested includes down payment and the cost of materials for me to redo most of the bottom unit.

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

A friend bought a 5 bedroom house super cheap in the same city and was making a killing renting out all the rooms to college kids!

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

We used a Realtor

How did you finance this deal?

Conventional Loan

How did you add value to the deal?

Renovated the basement myself, ALL sweat equity!

What was the outcome?

Our highest cash flow rental to date!

Lessons learned? Challenges?

Sweat equity does pay off if you have the time for it, I don't know that it would be as worth it for me now as my time can be spent doing many other income producing activities but for that time, this was an awesome opportunity for us!