First Investment Property!

[Nicole Cutlip]

Investment Info:

Single-family residence private money loan investment.

Purchase price: $20,000
Cash invested: $7,500

Investment Property #1
3 bedroom 1 bathroom, Single-Family home.
Built in 1908 in suburban neighborhood.

- Purchased through my county Landbank for $20k. Self-rehab costs $7k.
- Financed 50% through private lender ($10k) and paid out of pocket for remaining 50% plus rehab costs ($17.5k)
- Appraised at 5.5x more than the purchase price.
- Used this "primary residence" to take out a HELOC to finance the purchase and renovation of Investment Property #2 and purchase of #3.
- Note: Due to Landbank stipulations, I must use this as my primary residence for a total of 3 years.
- Potential rental charge $1,000/mo in November 2021

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

Almost every county has a "Landbank" of sorts... Some kind of county/community organization that purchases vacant or foreclosed homes for cheap, and then resells them to buyers with typically strict stipulations. Some of these property have no stipulations and are open to investors (this is how I purchased Investment Property #2).

How did you finance this deal?

50% purchase cost through private lender $10k
50% purchase cost out of pocket $10k
100% rehab-cost out of pocket $7.5k

How did you add value to the deal?

"Self-performed" 90% of the work.
- Relied heavily on my dad and brother for Mechanical, Electrical, & Plumbing updates.
- Learned basic finishing skills from my mom (she is whiz with drywall/plaster repair)

What was the outcome?

This property appraised for 5.5x the amount I purchased it for.