First Property mistake and lessons learned

[Luis Y.]

Investment Info:

Townhouse buy & hold investment in Mililani.

Purchase price: $395,000

My very first purchase... made a lot of mistakes. Started Househacking with the property and after about a year and half decided to move and rent it fully. Learned a lot from the property wish Im very thankful about, as well as managing bad tenants. Currently its rented out but not necessarily making any cashflow. Definetly looking, to apply everything I learned from this property on my next purchase.

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

Well I was living in Oahu, HI for 3years while in the military and renting an apartment for $2400. After some consideration I decided if I was going to spend my money on rent might as well do it on my own property. So I used my VA loan benefits to finance a condo in a nice area i liked. At the time i figured rent out one room since i had 2 and Im single... then i realized I could rent both rooms and live for free in my own place while doing cosmetic remodeling.

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

Through MLS with a Real Estate Agent is how I found this property. I used a VA Loan for the financing put an offer and it was immediatly accepted. (I realy did not know what i was doing or how to analyze)

How did you finance this deal?

VA Loan

How did you add value to the deal?

At present time I did some cosmetic improvements to make the most out of the property and add rental value

What was the outcome?

Currently Holding and workin on it to make some profit or come out even

Lessons learned? Challenges?

Definately learning how to analyze deals!
Grasp a decent foundation and learn the language of what your getting into... If you dont understand the meaning of something, research it and ask questions.
Friends can also be bad tenants, sometimes they feel entitled... and you can run into a situation where it ruins your friendship. Simply keep it strictly business.
Build a solid exit strategy, probably the biggest challenge i have faced.