House #3. The big scramble!

[Diana Baccus]

Investment Info:

Single-family residence buy & hold investment in Owens Cross Roads.

Purchase price: $160,500
Cash invested: $9,500

Our current house. We are moving out at the end of June and already have a tenant to contract for August. 3 bed 3 bath, two-story, brand new house with large fenced in yard and two car garage. Definitely a step up from my first two.

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

We had to move to this town for work and there was nothing decent to rent in the area. That's why we bought a rental. It was obvious that it will be a good rental one day.

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

New construction subdivision. No negotiation was needed - people were waiting to buy houses here so we just got on the list. Someone's financing didn't work and we jumped right on it.

How did you finance this deal?

Conventional 5% down with a huge help from the developer. They paid half closing costs. It was a big scramble. We were not ready to buy another house but as they say... just start working on it and you will make it work. Had to change banks late in the process and transfer appraisal. It was a nightmare but we made it work!

How did you add value to the deal?

Put up a fence and waited 11 months. The house has appreciated a lot since the subdivision was finished.

What was the outcome?

We live in it and we have a line of people waiting to rent it once the year is up in July.

Lessons learned? Challenges?

Oh so many lessons. Second time working with (little to) no agent and doing everything by myself. Stared with one bank and they just became unresponsive and did not want to work with my situation so I told them to transfer the appraisal to my new bank and refund my money. I had to talk to the director of the bank for the whole state. Seriously messed up situation but here we are...

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

The developer/management company had an agent in the model home in the subdivision but he did nothing for us. Except write up an offer and take his commission. Did not even show up for the closing. I met him one time and exchanged 5 texts. He made $9k from that.