Ten Unit Off Market Purchase

[Tim Lynch]

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $825,000
Cash invested: $82,500

Great 10 unit property located in a sought after area of Tumwater Hill near a large community college, state offices and west side Olympia.

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

The location of the building is fantastic! Rents were ok and the property cashflowed at those numbers.

How did you finance this deal?

I was able to negotiate with the seller to carry the note for 12 months with only 10% down. The 10% down payment was made with a line of credit. Within the 12 months I will be able to refinance the loan with traditional financing and cash out the seller. This got me into the property, and refinanced, with no cash out of my pocket!

What was the outcome?

Using a line of credit for the down payment and negotiating seller financing for the rest I will be able to own this building with no money out of my pocket once refinanced. Rents have been raised on 5 units to get the debt service ratio and CAP rate to a number that shows 20% equity in the property and thus shouldn't have an issue appraising for the needed amount.

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

I am a real estate agent.

[Tim Lynch]

Thanks so much @Curtis Bidwell! This property is on Tumwater Hill.  There are 2 - 2/1 units and 8 1/1 units.  I would prefer all 2/1 units, but we take what we can and the as long as the numbers make sense!  Other than typical tenant turnover, if anyone ever leaves, we don't have any renovations to do.  I've had to replace one dishwasher in the few months we've had the property, but so far that is it.  So far, no issues with the tenants paying their new increased rents either (knock on wood).