San Diego VA House Hack

[Christian Johnston]

Investment Info:

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

Purchase price: $1,140,000
Cash invested: $1

The deal:
-Location: San Diego, North Park/Normal Heights
-Gentrified neightborhood, brand new remodel
-Triplex with an additional detached studio.
-3 Bedroom, 1bath house and backyard (ONE UNIT)
-Duplex, Both One bed on One bath. (Two Units)
-Detached Studio in the back of 2 car garage.
-Electricity individually metered

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

Real estate investment books

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

Via Real Estate Agent Kenneth Donaghy

How did you finance this deal?

VA Loan. 1.14 million with $46,500 seller credit.

How did you add value to the deal?

Original listing price: 1.4 and 1.25. Made a low offer during the beginning of COVID with the knowledge that the sellers had a hard money loan they would want to get out of. Offered substantially lower than listing price but with an aggressive escrow timeline.

What was the outcome?

Rental Income (current rents, not projected):
3 Bed house: 3100
Duplex: 3470
Studio (AirBnB): 1450-1900
PITI: 6350
Income (without expenses): 8020-8470
Property is newly renovated with brand new floors, appliances, roof, etc.

Lessons learned? Challenges?

1)Knowing what the seller wants is critical. The seller wanted profit and to not get buried by a hard money loan interest rate. This allowed us to make a lower offer with a short escrow time. Terms Terms Terms. 2) Don't be impatient. We analyzed the numbers on over 120 deals (from San Diego all the way up to OC...multifamily to SFR). This was one of two properties out of the 120 that I felt "worked" with the numbers I wanted.

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

Real Estate Agent: Kenneth Donaghy
Mortgage Broker: Nick Lekas

These guys did an absolutely amazing job and have my highest recommendation.