Multifamily renovation for cash flow

[Cyndie Rogers]

Investment Info:

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

Purchase price: $65,000
Cash invested: $50,000

A quadruplex with great income potential but in need of updating and renovations. We have completed one unit and currently have two others under construction. The roof was replaced in 2015 so we are focusing on the plumbing and electrical and we plan to do all the windows within the next few months. We have also replaced two of the four heat/air conditioner units. Complete renovations inside with some decorative upgrades should attract good quality tenants for the long term.

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

The property was available through a family member who did not keep up with many maintenance issues. Although an extensive rehab was in order the equity was there to allow us to refinance upon completion providing an excellent cash flow.

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

I purchased this from a family member who no longer wanted to manage it.

How did you finance this deal?

We used a hard money broker that we had used previously to secure a purchase loan with a low payment albeit higher than I would like interest rate for a few years providing ample time to refinance.

How did you add value to the deal?

We added value by doing a renovation of the entire building and updating the basics so that there would not be many issues in the near future.

What was the outcome?

Still in progress but have one unit rented at a substantial increase from the

previous tenant.