First Investment Project

[Matthew McCormick]

Investment Info:

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

Purchase price: $190,000
Cash invested: $50,000

3 units bringing in $3,850 before mortgage. (approx, $2,200 after expenses per month)
Our first project, definitely had/have many headaches with this property but it's been a great start.

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

Learning about multi-family investing in North Jersey and watching the changing markets of Newark.

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

On the market, originally priced around $220k.

How did you finance this deal?

25% down, conventional.

How did you add value to the deal?

Fixed up 2 units - new walls, repaired floors, lighting fixtures, paint, kitchen updates, bathroom updates.
Replaced hot water heaters + furnaces.
SS appliances.

What was the outcome?

Higher rents. Pre-COVID we placed the house on the market in February 2020. We had multiple offers, up to $325k that all fell through during the pandemic. We're actually thankful for that, because this property has definitely been a great tool during these stressful months and now will be a much longer hold.

Lessons learned? Challenges?

Basic landlord tasks. Learned to appreciate the asset much more during the pandemic.

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

Agents, NJ Lenders (I have a phenomenal lender if anyone is interested), contractors.