Two houses on one lot and a brand new Starbuck half a block away!

[Hans Christopher Struzyna]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $322,000
Cash invested: $64,400

Contributors:
Kristin Hedstrom

Two houses on one lot. We bought this place with one tenant in place and rents at roughly 60% of the market. WE are going to renovate this in two stages and get the gross rents at $3200+ for the whole property. Plus a Starbucks just moved in down the street so the neighborhood is really up and coming!

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

We were looking for a more traditional multi-family property but realized that we could get a premium on rents if we got two houses on one lot. This one was also poorly represented by the Seller's agent and we were able to negotiate a bunch of repairs in escrow. Plus instead of putting 25% down, we were able to put 20% down. According to ot the lender, its a single family with an ADU not a multi-family. So our cash in looks way better.

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

It was on the MLS and our agent, who also invests, helped us negotiate it.

How did you finance this deal?

Traditional 30 year fixed financing with a 20% down payment.

How did you add value to the deal?

WE will add a bathroom to the front house and renovate the finishes on both. Long term, we hope to tear down the back house or at least do an addition to it.

What was the outcome?

We are in the middle of this so stay tuned.

Lessons learned? Challenges?

We had a low appraisal and had multiple delays in escrow. The lesson learned is to always ask for what you want as the other side my just give it to you!

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

DM me for that!