3rd Buy-and-Hold SFH in Our Portfolio

[Chris Baxley]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $503,000
Cash invested: $125,000

Three years ago we purchased the twin, neighboring property (they had been built at the same time, by the same builder with the same floor plan) as our second SFH Buy-and-Hold and I ran into the then owner of this home and told her that if she ever decided to move to let me know. Three years later I got a text from her that she was moving. I went over to view it a few days later and made her an offer that afternoon.

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

My wife and I had grown comfortable with REI with our first two properties and I knew this house had been built better than any of the others in the neighborhood (we had looked at 20+ in the neighborhood before buying the neighboring house 3 years earlier).

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

Happened to meet the owner when we purchased the neighboring one in 2017 and told her to give me a call if she ever decided to move. She had planned to use a broker and sell it for $525.000. I told her that I was a buyer in the $500-505K range and that I could both save her the hassle of numerous showings AND put more money in her pocket net-net. She thought about it and we agreed to $503K.

How did you finance this deal?

Conventional Loan

How did you add value to the deal?

Home is still very new (4 years old) and in great shape, so no need for CAPEX investments. As I had done before, I included a clause in the purchase agreement that I be allowed to market and show the home before taking possession. I had it rented before closing on it and it would be vacant for a full 24 hours.

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

No