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Updated over 4 years ago,
Buy and Hold Goes From Bad to Terrible for a $10K Profit
Investment Info:
Single-family residence buy & hold investment in Beaumont.
Purchase price: $21,000
Cash invested: $21,000
Sale price: $30,000
2/1 that needed quite a bit of updating, but it had an elderly tenant in it that had health issues & also had a son staying there that didn't work or helped her at all with payments. The rent was $750/mo with housing picking up $624. We bought it on Sep 8th or so & received our 1st housing payment on October 2nd. Unfortunately, tenant passed away on the last day of Sep. I had some trouble getting her son to leave but he was out by mid November & I ended up paying him $250 to help him leave.
How did you find this deal and how did you negotiate it?
I sent them a postca. The seller was an older gentleman, in his 80's, and this was his last rental. He needed to sell it because he was afraid that if something happened to the tenant he would have to deal with her son and the tenant's daughter who lived across the street. This is in a really rough area of town. The sellers had talked with other investors buy they had offered her no more than $18K and she wouldn't take less than $21K. Even at that price if was a deal for me so I took it.
How did you finance this deal?
CASH
What was the outcome?
After the tenant passed away and I got her son out the house remained vacant for about 5 months and I ended up "wholesaling" it to a local investor who paid me $15,000 at closing and will make $1000 payments for 15 months.
Lessons learned? Challenges?
Even though I only owned it for a few months, this house was a horror story, lol. I had a tenant pass away, an upset family and son who I had to pay to leave, a homeless woman move in (my handyman found her as he crawled in through a window cause he didn't have the key), and oh yeah I got punched in the face by an apparent random druggie walking down the street. In the end, I'll still end up with about $10K in profit, so I guess I'd get punched in the face for another deal like this one.