Headache 5 Unit Hold and Flip

[Chris Risi]

Investment Info:

Large multi-family (5+ units) buy & hold investment in Phoenix.

Purchase price: $311,000
Cash invested: $10,000
Sale price: $344,500

This one was a lot of heartache, and thankfully made a little bit of money in the process. Originally it was planned to be the first in a portfolio of long term rentals, but ended up having too many difficulties and wanted out.

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

I originally wanted to buy this because so many real estate investors talk about small multifamily being a great asset to have. The key is having the RIGHT multifamily. This one was a long distance investment for me, and the property manager that came with the property was really terrible.

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

Found this through MLS.

How did you finance this deal?

A partner who used a HELOC.

Lessons learned? Challenges?

Lesson learned on how important good property management is and good tenant screening! It was a rough property in a rough neighborhood, and as Brandon says, this will produce "rough renters."