Buying my first property with a cash flowing 4-plex

[Jeff Ostrander]

Investment Info:

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

Purchase price: $130,000
Cash invested: $40,000

Four plex in a revitalizing area of town. Cash flows about $200 a door which will only increase as the area continues to become more desirable to live in.

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

I love the idea of a cash flowing multi family within SFH neighborhoods.

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

My friend and mentor was presented this deal but he is no longer interested in purchasing more rentals. Knowing that I wanted to grow my portfolio, he introduced me to the owner, where we agreed upon a price with the guidance of my mentor.

How did you finance this deal?

Residential financing with 30 year loan and 25% down.

How did you add value to the deal?

Currently updating the cosmetics of the property from paint colors to landscaping. The previous owners were older and hadn’t made the units more modern.

What was the outcome?

Yet to be determined but hope to attract more desirable tenants.

Lessons learned? Challenges?

I learned how to negotiate an off market deal without the help of a realtor along with the entire buying process. I received lots of help from biggerpockets forums and friends.

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

I really enjoyed working with the private banking section of Arvest for my financing.