First Deal is an Out-of-State, Value Add Duplex!

[Nina Granberry]

Investment Info:

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

Purchase price: $156,520
Cash invested: $41,985

Contributors:
Lee Ripma

New roof installed at closing
Inherited tenants
Value add property with lots of upside potential

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

I saw an opportunity to get started with investing in real estate and took the leap. I was interested in this deal because it met my criteria for a great deal based on my research, has a lot of value add potential, is in a great rental market and is located near my hometown. I have a local partner that will manage the property.

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

This deal was brought to me by Lee Ripma, an investor in the KC market herself in MFR (also a guest on the BP REI podcast, episode #373). We were able to negotiate getting a new roof at closing as well as other seller credits. The appraisal came in higher than the sales price, which I hear rarely happens these days. Lee was super helpful throughout the entire process; she negotiated on my behalf.

How did you finance this deal?

Conventional residential loan
30 - year fixed rate mortgage, 25% down, 3.9% interest

How did you add value to the deal?

When the current tenants move out, we plan to do renovations to both units, updating the kitchens, bathrooms and flooring.

What was the outcome?

Once the updates are completed, we will be able to raise the rents of both units by over $300/unit.

Lessons learned? Challenges?

+ The most challenging part of the process is the financing part. Lots of tedious paperwork to gather for the loan application
+ Ask lots of questions of your agent as you walk through the process. It helps to have someone that is responsive and patient as you learn
+ After having gone through this process, purchasing a property is not as daunting as it seems from the outside looking in.Read, save $, prepare for the opportunity

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

Lee Ripma
Michelle Lutz (Agent)
Matt Goodwin with Guaranteed Rate (Mortgage Broker)

[Nina Granberry]

Originally posted by @Nic S.:

@Nina Granberry congrats! I bought the two duplexes next to yours

That is awesome! Do you have plans to make any updates to your two duplexes? One of my units needs work. Well, they both do, in my opinion, but one needs it way more than the other. I’m glad that you found me on BP!