Long Term Buy/Hold in Winter Park, FL

[Hilary Stalder]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $300,000
Cash invested: $65,000

3/2, 1850 SF single-family in A location with A schools in Winter Park, FL 32789. Partnered with in-laws on this project. We started construction 6/19 and we're attempting to get the house ready for rent in August to beat the school year starting. Depending what the market looks like when we are finished we may re-fi to recoup the construction costs. The property is worth in the low $400s once it's complete. Otherwise the property is interest only payments of $500. We expect to recoup construction costs in 5-6 years if we can get the desired $2400-2500/month in rent.

Purchase Price: $300k
Down Payment: $10k
Principal: $290k
Mortgage Payment: $500
Taxes/Insurance: $500
Lawn: $100
Vacancy/Repairs/CapEx: $360
Total Monthly Expenses: $1435

Total Expected Monthly Rent: $2400-2500
Total Monthly Cash Flow: $965-$1050

Can't wait to share pictures of this one. It's going to be quite the transformation!

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

I loved this property. I know we're not supposed to get emotional but it was difficult with this guy. When I found out my father-in-law bought it with owner financing and was paying interest only payments I knew the numbers may be different than my initial analysis. Sure enough, once the numbers worked we were all in! The area alone is worth the value in the land.

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

My father in law knew the original owner. He passed away and his daughter (who lived in DC) was trying to sell it. Because of the connection she was excited to sell it to someone she knew/trusted.

How did you finance this deal?

Owner financing. Interest only payments for 7 years, balloons at 7.

How did you add value to the deal?

We're doing a complete gut of the house. New roof, new AC, moving electric panel (fortuneatly electrical had already been updated and house had been replumbed), new flooring throughout, new kitchen, new M bathroom, updating 2nd bath. Full facelift. We're projecting this will take about $60-70k.