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Updated over 5 years ago on . Most recent reply
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My First Investment Property
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Pontiac.
Purchase price: $22,000
Cash invested: $30,000
Duplex
How did you find this deal and how did you negotiate it?
This property was found on the MLS. I did't know anything about negotiating at that point, the property was listed for $30,000 and I offered $22,000. The seller was an older gentleman in his 80's that was looking to sell his portfolio of 20 properties and was listing 2 at a time. Come to find out he had a higher offer at $28,000 but he didn't like the guy so he turned it down. He happened to like us and took the $22,000 and never even counter offered. Lesson - Be kind to everyone!
How did you finance this deal?
Line of Credit
How did you add value to the deal?
Rehabbed the interior of the property, new kitchens, paint, light fixtures, and flooring.
What was the outcome?
When this property was purchased the first unit was renting for 595, which is now renting for 900. The second unit was renting for 605, and is now renting for 1200.
Lessons learned? Challenges?
This property is not a good neighborhood and during the rehab process the house next door burnt down. They did not have insurance so I had to fight with the city for 2 year to demo it. During that time I had no choice but to accept less than market value rent after rehabbing it. Once the house was on the demo list and taken down, I was finally able to charge market rent.
Most Popular Reply
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That's a great story and opportunity. I am new to real estate also. Learning on the fly but definitely inspired by the success stories. I am still wishy and washy on whether to be full time or not, but since being unemployed and going into self-employed, it's a bit of a learning curve. I did purchase 1 property on RoofStock, free and clear with rent at $775. Working to close on a duplex with rent on unit 1 at $825 and second at $795. Definitely, need to get the second to match up. Still new at this and figuring out the "How" side of real estate.