Condo Investment gamble on appreciation pays off

[Antonio Figueroa]

Investment Info:

Retail buy & hold investment in Jersey City.

Purchase price: $415,000
Cash invested: $5,000
Sale price: $502,000

2 bedroom
1 batch
1200 sqft
condo

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

Jersey City is growing in leaps and bounds. The fact I was less than 5 minute walk to the transit which would take me to Manhatten in 30 minutes was great.

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

I live in the condo and saw new units being built so spoke with the "house agent" to get the details.

How did you finance this deal?

Conventional with 20% down

How did you add value to the deal?

The bathroom was large in size but had no storage and vanity. Spent money to build a closet and add a large vanity with stone top.

What was the outcome?

After holding for 3 years the appreciation has driven the value up and we are under contract for $502,000.

Lessons learned? Challenges?

Being it was brand new the taxes at closing turned out to be incorrect and were doubled in a year! There is also a tax abatement which will expire in 5 years which put us in the mindset we would pay even down the road. We were already renting at the market maximum so that coupled with our HOA going up made it a slow bleed but ultimately a good ROI thanks to appreciation.

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

This time we decided to work directly with our tenant who wanted to buy the property. Before deciding on a price we spoke with 3 agents to get an idea on what it could sell for then set our price at what we think would make sense.