My first rental property! Turn key investment turned rehab

[Beau Watson]

Investment Info:

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

Purchase price: $108,000
Cash invested: $37,000

Small 1400sq ft duplex in Covington, GA
Light cheap renovations done a couple of years ago.
Inherited tenant on one side.
HVAC replaced already

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

I knew my money was better used in a real piece of property rather than sitting in a mutual fund. I was interested in a duplex because I always want some money coming in, a SFH doesn't give you that. I couldn't afford anything bigger. Smaller was not an option

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

Wholesale company. New Western. I used the 1% person rule and stuck by it while negotiating

How did you finance this deal?

Hard money loan. 7.55% interest rate. 25% down.

How did you add value to the deal?

After inherited tenant moved out we are currently in the process of renovating that one side of the duplex. Small bit of landscaping and a big portion of adding value was knowing the market rents, marketing the property correctly, screening for good tenants and charging appropriate rents.

What was the outcome?

Not fully done yet. We will be looking to refinance out of the hard money once this renovation adds value. After that and bringing rents from $575 to $875 on the renovated side we should see a cash on cash return of around 18%!!

Lessons learned? Challenges?

Wont make money right away. Be ready for that. Tenants are gross after they have lived there for 3 years with no inspections. Be ready to kill roaches.

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

I have a good contractor I will absolutely be bragging about his job when we are done

[Beau Watson]

Originally posted by @Moises R Cosme:

Awesome!!! Congratulations!!! 

Thank you sir!!