Our First Rental Property

[Paul Jagielski]

Investment Info:

Single-family residence buy & hold investment in Philadelphia.

Purchased this home as a first time home buyer. I knew I wanted to get into buy & hold rental properties. This property was in need of a lot of updates and only had 1 owner prior to us. We bought it at a far price, renovated as well lived there for the first couple years. After renovations were done we decided to move out and turn it into a rental property. We have rented it now for about 3+ years with good cash flow. After another year or so of renting we will be looking to BRRR this property.

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

We were moving back to the area and didn't want to rent. We knew the advantages of owning and investing. Took us several years to find the deal and get the financing together but once we crunched the numbers we knew it was the right first deal for us.

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

We found this deal because a family member of ours that is also an investor had been shown the deal and he knew our situation of moving across the country back to area and what we were looking for. He had another project going on at the time so he offered it to us.

Negotiations were a little tough because we were coming in so low from asking. But we supported our offer with estimates and ultimately our offer was accepted.

How did you finance this deal?

Personal saving we had saved from our W2 jobs.

How did you add value to the deal?

We took down a wall in the kitchen, added an island and a dishwasher. Demoed and remodeled the bathroom. Pulled up all the carpets, finished and sealed the hardwood floors. Added central air to the property and did some minor landscaping around the exterior of the row home. And finally finished the basement.

What was the outcome?

Rent is amount the highest in the area.

Lessons learned? Challenges?

Off street parking is a huge bonus (we do not have it). It takes time to find "the deal" and many "no's" along the way. Do your homework before getting a property under contract. Don't be afraid to walk away from a deal. Just because you have time invested doesn't make it a good deal.