Brick Cottage Renovation

[Eric Berman]

Investment Info:

Single-family residence buy & hold investment in Beaufort.

Purchase price: $100,000
Cash invested: $63,500

2 bedroom, 1 bathroom, 730 sqft SFR.
​Currently rented for $1,200/mo.
www.bermanpropertygroupllc.com

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

Solid location w/ lots of room for value-add

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

Realtor. It was listed initially at 125k and needed a lot of work. Viewed property and put in an offer for 90k which was rejected. Moved on with my search. After 2.5 months, no one was biting on it. Price was lowered to 115k. We submitted a second offer for 95k. Seller came back at 100k which we accepted.

How did you finance this deal?

Conventional; 30 yr fixed at 4.85%

How did you add value to the deal?

Needed a hefty amount of work inside and out. Cleaned out, sanitized (via pest service), and re-insulated attic. New roof. New plumbing throughout entire property. It was galvanized plumbing, so we upgraded everything to PVC and PEX. Decent amount of wood rot in sub-floor in living room, bedroom, kitchen, and bathroom. Ripped up all floors, replace subfloor, replaced floor with LVP throughout, all new kitchen, & bath, new paint everywhere, and some minor exterior work.

What was the outcome?

Total rehab was ~34k. Currently rented for $1,200/mo.

Lessons learned? Challenges?

If you find wood rot in one place, you're gonna find it in others. This will almost assuredly force your hand with other repairs/rehab. For example, from the inspection, we found wood rot in the center of the kitchen. Once we ripped up the floor (linoleum), we discovered that the rot extended underneath the cabinets and into the bathroom. Needed to tear down dry-wall and cabinets and furnish with new. Also, shop around for contractors. Got crazy quotes from a few before settling.

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

Yes. Allison Greco; If you're in Beaufort, SC, she's the way to go!