Live In Multi Family - Living for free

[Ben Fairbanks]

Investment Info:

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

Purchase price: $299,000
Cash invested: $59,800

This multi family was my first home purchase. There is a primary living area 2000sf and a mother-in-law suite of 1000sf that has a separate entrance. Living in the home and renting out the spare area has been a great introduction to, homeownership, investment properties, and property management. This has afforded me the opportunity to have the majority of my mortgage covered and has been offered a more thorough learning curve for what it takes to maintain an investment property. Future plans will be to move out and keep the home to rent out both levels.

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

I was interested in single family homes has a investment properties but was tired of renting and wanted to purchase a house. The layout of this home was perfect for both. It gave me a quality single family home feel with the larger living area but allowed me to get into owning an investment property now.

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

MLS, Tour, Offer, Counter on closing costs and changes after inspection.

How did you finance this deal?

15 Year, bought points, 20% down to get to the principal quicker.

How did you add value to the deal?

Renovated the rental apartment to make it from a 2 bedroom to a 3 bedroom. Fully landscaped the backyard to add a fire pit and comfortable common space.

What was the outcome?

80% mortgage paid. Owning not renting.

Lessons learned? Challenges?

Property Management is handful. First ever renters: Young engaged couple moved in. They then split up, one moved out, we allowed a sublet, that person started smoking in the house, followed by hiding pets in the house. Ended up evicting.

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

Buyers agent when we purchased the home. Long story short, we did all the work finding the home, asked them for advise on making an offer and got nothing useful back for advise, and at the end of the day they got paid for it... Advise would be go with a realtor who does one thing and one thing well, this person tried to wear way to many hats and wasn't that good at any of them.