Section 8 rental duplex

[Kathryn Morea]

Investment Info:

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

Purchase price: $30,000
Cash invested: $6,000

This is a duplex purchased with a local bank loan and small down payment. Rented to section 8 tenants.

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

I wanted some cheap rentals for cash flow

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

Visiting the town in person and met with owner/investor looking to sell

How did you finance this deal?

Small down payment and local bank loan.

How did you add value to the deal?

This was pretty much turn key. Of course, over the years, repairs have been needed. We did add a heat pump which helped keep tenants in place.

What was the outcome?

I've averaged between 300-600mo cash flow on this duplex

Lessons learned? Challenges?

I would not buy a house in that area again with out having a heat pump. I learned that houses with out heat pumps are not viable for low income tenants because they will chose to pay their heat bill instead of rent. I have 4 houses on the same street and it's ok, But if I had to do it over, I might pick a better neighborhood. That said, for Sec 8, this neighborhood works pretty well.

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

I have not worked lately with any agents or lenders in that area. I had a great agent there but he has since retired.