First Real Estate Investment

[Charito Mattson]

Investment Info:

Small multi-family (2-4 units) other investment in Lakewood.

Purchase price: $410,000
Cash invested: $17,000

We made a mistake on this purchase. We are negative on our numbers. It's an FHA loan so we have to use it as the main resident for 1 year. It's giving a toll in our everyday commute to and from work (40 miles away).

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

My partner met a friend whom a very successful through real estate. We started watching videos and found out about Robert Kiyosaki's books then BiggerPockets.com.

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

We found this deal through our real estate agent by MLS listings. Our agents did not really negotiate on our behalf. He even warned us to be ready if the seller decided to increase the price because it was just a few days in the market.

How did you finance this deal?

We used my IRA account from the previous employer.

How did you add value to the deal?

None really. The units are well-maintained by the previous owner.

What was the outcome?

For now, we are negative on numbers because we are living in one unit. Maybe after we move out and both units can be rented out, we might be able to be positive. We'll see....

Lessons learned? Challenges?

Do the numbers before anything else. Never put the emotions when looking at any properties.

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

Disappointed with our agent, won't use him again.

[Brandon Vukelich]

Originally posted by @Charito Mattson:

Thanks @Jared Boundy. I will take our experience as a lesson learned. Hey, since you're broker maybe give us a head's up when you find a great fixer-upper one (if not in Seattle at least close enough). We are employees of King Co. Metro (downtown) so the commute is really way too far for us.

 Hi Charito, Sorry to hear about your first investment experience.  I don't believe any investor has a perfect record, me included.  In 2011, I was feeding a 6-unit in West Seattle $500/mo, got scared and sold. I lost nearly a million in potential appreciation if I would have held out just a few more years.  There may be a way to turn this deal into a positive experience.  I follow the multifamily market between Seattle-Tacoma very closely.  I would be happy to review your situation offline, no strings or pressure.  I love analyzing deals and running numbers. Best wishes on your goals!

PS - I have a friend at King Co Metro downtown, any chance you know Keith Rodmyre?