Duplex BRRR Chicago Section 8

[David Conroy]

Investment Info:

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

Purchase price: $39,614
Cash invested: $64,500

Purchased this duplex at auction and it needed some serious work top to bottom including new plumbing, ducts, furnace, partial reroof, garage siding, front and back porch, and bathrooms.

Rented it to two CHA tenants $100 for garage, and rents of $1200 and $1138. 3 Bed 2 Bath Unit and 3 Bed 1 Bath Unit.

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

I was looking to expand on my last investment and get a little larger property to keep moving up in size

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

Auction purchase

How did you finance this deal?

Did it with all my own cash and put debt on after rehab and renting

How did you add value to the deal?

Main source of adding value was close to a gut rehab that we did on the property to bring it to a point where its actually rentable and livable for tenants

What was the outcome?

I leased the property to two CHA (Section 8) tenants and refinanced the property to pull most of my cash out that I used to finance the project.

Lessons learned? Challenges?

Biggest challenge was I bought it as-is and it came with an $11,000 water bill which was a misreading, working through that with the utility company was a long and frustrating process. I might stay away from water bill problems in the future unless it's a cheaper deal.

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

Yes I worked with Manage Chicago for the rehab and they ultimately managed the finished project. Constructive Loans did the refinance, and a local agent Leon Ivy helped with the acquisition and underwriting of the property.