1st Multi-Family BRRRR in Mass

[Douglas McAloney Jr]

Investment Info:

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

Purchase price: $375,000
Cash invested: $70,000

Purchased a 2 family in 8/2018. 2nd floor was partially vacant and partially renovated, 1st floor was occupied and trashed. Used the tenants as a negotiating tool. Owner wanted $400K so i made an offer for $385K and told him I wanted the 1st floor vacant. He said he didn't want to evict them so I asked for another $10K off because it will cost me money to evict them and got it for $375K. Closed on the 8/30/18 and started the eviction process on 8/31/18. Got them evicted in 2 months. Lost 2 months rent @ $1500 per month so I negotiated the $10K off my offer, = $7K profit. Finished the 2nd floor reno and rented it out while evicting the 1st floor tenants. Gutted and renovated the first floor. I will refi and pull out my equity in September 2019, which should be around $80/$90K and get my cash invested and then some back and put it to work somewhere else. With my refi, my monthly cash flow will drop to $1K per month.

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

Had bought and held long and short term rental real estate in the past. Got out of it for 10 years. Always wanted a Multi-Family but heard horror stories so kind of stayed away... One day I said now or never. Glad I did it!! Looking for the next one

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

MLS.. Negotiation is in the description.

How did you finance this deal?

Conventional loan and personal cash

How did you add value to the deal?

Rehab

What was the outcome?

In the description as well.

Lessons learned? Challenges?

Should have used faster contractors.. Challenges were my first eviction, first tenant screening etc..