Main House and Guest House close to UofA

[Mark Savalle]

Investment Info:

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

Purchase price: $140,000
Cash invested: $123,000
Sale price: $330,000

BRRRR, Refinance in progress at $330,000 resulting in about $400 ($200/unit) in passive income after money is pulled out.

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

Bigger Pockets podcasts and reading

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

Found the deal on the MLS. Asking was $179,000 negotiated to $140,000.

How did you finance this deal?

Private money financed

How did you add value to the deal?

Complete remodel of both utilities and cosmetics. If I were to do this deal all over again I would treat my contractors different by giving them specific tasks, getting multiple quotes on specific tasks, and create a through vetting system for contractors. Because there was so much work to be completed I received quotes on the entire scope and it made it difficult to compare apples to apples.

What was the outcome?

I spent more than I should have on rehab costs paying contractors. The deal is still profitable but I wasn't able to pull every last dollar out of the deal.

Lessons learned? Challenges?

Contractor relationships; vetting, incorporating contractor signed timelines with penalties, bidding job for job (more time intensive but easier to keep on schedule and easier to watch expenses), receive a per unit labor cost for better future job estimation.

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

I worked with an agent/broker who is awesome, Zach Samorano @ Hot Casa Real Estate. He is a Tucson local born and raised, has extensive connections, knows the business, owns investments, is a family man with a solid moral compass.

Jesus Montoy with Montoy's custom cabinets. Super meticulous, always on time with timelines, hard worker, fair, trustworthy, great value system, family man, and reliable.

Fernando Galindo framer/licensed contractor is super trustworthy and fair.