First House-hack complete!

[Brandon Frulla]

Investment Info:

Single Family home, house-hack/buy & hold investment in Fredericksburg, Va.

Purchase price: $268,500
Cash invested: $15,000

Overview:

For my first deal, I bought a newly-renovated 4-bedroom, 2.5 bath SFH. I had two leases signed within a two days of closing (8/30/19), and am set to get the last lease getting signed tomorrow afternoon.

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

Initially, I had a 4-plex under contract in Danville, Va. I ended up walking away because we couldn't reach an agreement on the sale price after the inspection uncovered a need for some expensive repairs. I changed my strategy and started looking closer to home to do a SFH house-hack.

How did you finance this deal?

Conventional Mortgage, 5% down

Projected cash-flow?

This deal will clear at least $200/mo

[Brandon Frulla]

Originally posted by @Rob B.:

This is great work Brandon, and I'm loving the interior! It is also impressive that you were able to switch gears so fast and found a property in such a phenomenal condition. I love reading stories like this; and while I'm not as familiar with the Fredericksburg, VA area, $268,500 for a 4-bedroom, 2.5 bath like this seems like an excellent deal. If you don't mind me asking, what did you use to find those other tenants as part of your house-hack? @Brandon Frulla

Hey Rob, thanks for the compliment! 

The reason that I was able to do this deal was because prior to getting started with the Danville deal, I had already placed an offer on this house. 

Long story short, my offer was beaten by the flippers that I ended up purchasing the home from (about 7 months ago). I went on get the 4-plex under contract shortly thereafter. When that fell through I took a second look at my local market, and I saw that this home was for sale again in a much nicer condition (about 3 months ago). While my initial plan for this property had been a live-in flip over the course of the first year, the updated condition made me realize I could house-hack it.

I got high-quality tenants for each room off of craigslist/Facebook marketplace. I marketed the photos and screened tenants during the closing process so that I could have leases ready for signature as soon as I got legal ownership of it. It was very smooth overall, and I plan to repeat this process at least 2 more times before I'm out of college. The old homes will become regular investment properties as I move out and on to the next, as is the house-hacking way.

A side note on buying a flip for a house-hack:

Everyone knows that buying a SFR in turn-key conditions like this comes at a premium, and it is generally not the most cost-effective plan. That said, if you negotiate well and apply a house-hacking approach, it can be a good way to get properties in fantastic condition that are very easy to rent out (most would rather have a room at a nice place like this than one in a shabby basement apartment, it sells itself).

Let me know if you have any more questions!