Lessons Learned After Buying My First Home

[Travis Bouchonville]

Investment Info:

Townhouse buy & hold investment in Aiea.

Purchase price: $485,000
Cash invested: $30,000
Sale price: $515,000

3 bed 2 bath townhouse. 1191 square feet. built in 1975

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

I was eager to start my investment career.

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

I used a VA home loan and therefore a little restricted in the negotiation process since the VA goes off the appraisal. In hindsight I wish I would've attended meetups before jumping in headfirst. The seller moved out of state and was probably pressured to sell and I could've negotiated a better deal. That being said I definitely came away with some good lessons and I don't regret it since taking action is better than not taking action.

How did you finance this deal?

VA home loan

How did you add value to the deal?

It was move in ready. I looked into adding a bedroom but restrictions due to inadequate parking did not allow the permit to be pulled.

What was the outcome?

I am currently renting out the master and single bedroom. This is a great experience and I am using a lot of the recommendations and documents from BP. My tenants have been in the house almost 6 mo and so far it's going well.

Planning on taking a HELOC once I have more equity built up so I can fund more deals. Also, I'm chunking with a Credit Card to pay down principle. Wasn't sure about this process until I did the math with an amortization calculator and truly understood how to do it.

Lessons learned? Challenges?

Don't buy something with an HOA fee, it sucks the cashflow out of the deal. Market rent is about 2350/mo for comps, and my mortgage + HOA runs 2900/mo. House hacking now, but planning to replace myself with another tenant which should allow the place to cashflow $100-200/mo

Keep a professional demeanor among tenants and don't get too comfortable. It's difficult living in the same residence as them and enforcing house rules. But luckily I've identified it and am better for it.

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

Yes! Lisa Onishi with Locations was my agent. She worked very hard to make the buying process for me less difficult. She responded back very fast, and knew the market very well. Thanks Lisa!