2nd Property Purchased in Mars Hill, NC

[Joseph Bafia]

Investment Info:

Single-family residence buy & hold investment in Mars Hill.

Purchase price: $86,000
Cash invested: $16,000

2nd property purchased in Mars Hill.
2/1
Intended to do as STR but ended up as LTR (for now)

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

Already had 1 cabin in this community that was doing well. Saw the potential for additional short term rentals in this market.

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

Found the listing on Zillow. Listed at $149k. Although a fair price, it needed alot of updating. Since we didn't have to have this property, we offered $95k which we had no expectation of acceptance. We got a counter of $129k and we declined. Told realtor to reach out if they changed their mind. 3 sisters inherited and wanted to get rid of and finally accepted $95 and then after inspection we got it down to $89k.

How did you finance this deal?

Financed it through traditional loan as a 2nd home with 10% down.

How did you add value to the deal?

new appliances, new window, new deck, updated flooring throughout.

What was the outcome?

Goal was to rent as STR (like our other one). Covid hit just as we were ready to list on VRBO/Airbnb, so we were on hold. During that time, our housekeeper of first property needed a place to live and we negotiated a LTR on it at $1000/month.

Lessons learned? Challenges?

Never be scared to offer what is fair to you. I wanted to offer $100k which I thought could still be too low, but my son convinced me to go lower at $95k and we still got it even lower than that. You never know peoples motivation. Challenge is to have reserves (which we did and alternate exit strategies. We went LTR, but can also flip if needed.

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

Worked with a local agent to the community but we were one of his last deals before retirement.

[Dave Spooner]

Congrats on your second property! I'm glad you were able to work out a LTR in the midst of everything that's going on. Sounds like a good plan to have one STR and one LTR as we continue to see how all the COVID stuff will progress.