12% COC ROI and &175,000 equity deal in Boise

[Brad Sabako]

Investment Info:

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

Purchase price: $227,500
Cash invested: $68,000

I bought a 1940’s bungalow that was neglected for years and spruced it up. Put in great tenants and I have a really solid investment in the fastest growing metro in the country!

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

I wanted to invest for cash flow, and I had been watching Boise Real Estate start to take off. I wanted to buy in the path of progress.

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

I traveled to Boise for 5 days. I found an experienced realtor on an open house. I made her an offer the same day, and added $2500 extra when she told me there was another full priced offer.

How did you finance this deal?

Traditional bank loan, Fannie Mae product.

How did you add value to the deal?

I painted outside, cleaned up yard, RE-painted kitchen cabinets, added a front porch railing.

What was the outcome?

2 years later it cash flows about $650/ month, and I’m about $190/ mo low on rents. By fall, I will raise rents to the market price at turnover.

Lessons learned? Challenges?

Always check sewers on 60 year old properties... a $300-400 scope job as part of pre closing inspections is money well spent. Also, when you know what you are looking for, pull the trigger fast!

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

Yes. Stacy McBain of Inflow Properties, Boise.