Converted Primary Residence to Lucrative Rental

[Derek Tellier]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $164,900
Cash invested: $10,000

Bought this house in 2004 as my Primary residence.
Don't know in total what I spent over the years on rehab but in 2019 put about $10K into it

Refinanced with appraisal coming in at $247K
Pulled out 75% LTV
Used that money to finance another property.

Renting for $2100/month for a cash flow of about $300 when accounting for 30% expenses.
I'm self managing for now though.

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

Cash Flow

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

Already Owned it

How did you finance this deal?

Existing Mortgage and Heloc were in place on property.
Refinanced and pulled out 75% LTV.

How did you add value to the deal?

Light remodel, 15 years of living in house and keeping it up.

What was the outcome?

Profitable SFR Rental with tenants in place
Tenants hope to buy within 3 years which will allow me to pay no capital gains due to it being my primary residence for 2 of the previous 5 years.

Lessons learned? Challenges?

Never under estimate what someone will pay in rent in your market.

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

No agent needed on this one but I served as my own to purchase the replacement home I moved into.
Highly recommend Maryville Title for all your title work and closings in the area.