Fell into buy&hold accidentally

[Bethany Patterson]

Investment Info:

Single-family residence buy & hold investment in Oklahoma City.

Purchase price: $71,500
Cash invested: $5,000

Purchased 3-bed 2-bath home as a primary residence in 2012, lived in it as a primary residence and rented the back half for several years. Converted to full-time rental early 2018. Estimate $60,000 in appreciation earned since 2012.  Rented for $1,100/month now, cash flow $350/month after pulling out mortgage, capex savings.

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

I knew it was a great deal in 2012: our apartment was $400/month, increasing to $500/month after some small improvements. When I purchased the house the mortgage was $550/month and we had a renter living in the back half of the home paying $400/month.

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

I got in touch with a local realtor after I applied for a job with him! I ended up taking another job, but then asked him to help me find a house. This was a house listed normally on the MLS.

How did you finance this deal?

First time homebuyer program with a zero-down local program tacked onto it. I had to pay for the termite inspection and one other one, got the seller to cover closing costs, so I moved into the house for less than $1000 cash.  We lived in the house for 6 years, then converted it to a full time rental.  Updated a bathroom, painted and improved some flooring.

[Cassi Justiz]

@Bethany Patterson Congratulations on this deal! I love primary residence homes converted to full time rentals. This is also how I got started and what I recommend to most new investors.