Duplex on the Northside of Pittsburgh

[Kesete Thompkins]

Investment Info:

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

Purchase price: $35,000
Cash invested: $10,000

Duplex purchased in 2017 that currently needs to be renovated. Each side is a 4 bedroom/1 bathroom with original hardwood floors, pocket doors, and large rooms. There are thoughts of making this a rooming house where we will rent by the room, or renting to a family in need. We are also considering renting this to a low-income family.

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

My wife and I were interested in this deal because it's on the Northside of Pittsburgh where I'm from. I know the area really well and there are plans for MAJOR development (The Esplanade) in the upcoming years. In addition, this property gives any tenant immediate access to the highway and can get one to the casino, Heinz Field, and PNC Park within 10 minutes. Also, this was our first deal as an official company, so we had to grab the deal.

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

I found this deal one night on Craigslist. I kept seeing the property every night that I opened Craigslist. I knew the location but I was scared to call on it. One day I decided to call and talked to the wholesaler who had it under contract. Ironically, I knew the wholesaler from high school!!!! In regards to the negotiation, the listing price was $40k and we got it down to $35k without much hassle because he remembered that our interactions 17 years ago in high school were respectful.

How did you finance this deal?

Cash from stock investments.

How did you add value to the deal?

We plan to add value through a complete renovation (New EVERYTHING)!

What was the outcome?

We are still looking for the financing to complete the renovation. We plan to focus on one side first, rent that out, then use those profits to fund the renovation of the other side.

Lessons learned? Challenges?

Tons of lessons learned here!
1. Don't bite of more than you can chew.
2. Project management matters!
3. You need a budget to ensure that you are not spending money in the wrong place.
4. You need a reliable CONTRACTORS to ensure that you can get solid bids to complete the work to your specifications.

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

N/A