Apartment in a 3plex. 2Bd, 1Ba, 213 sqft

[Samson Hollmérus]

Investment Info:

Other buy & hold investment in Korsholm, FINLAND.

Purchase price: $125,000
Cash invested: $5,000

Apartment in a 3plex.
Its a 2Bd, 1Ba, 213 sqft

First home buy and hold.

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

At 20 years of age I felt it's time to buy a house.

It felt more of a challenge rather than an investment because I didn't think we'd get a loan with the incomes we had at the time.
Due to showing excellent money management records from my local bank they loaned us the money needed for the full purchase price. The 5k investment was buying guarantee's from the state (Needed two backers for the loan) one was my father, and the other, the state.

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

Found it first through a local online portal called findit. It was posted as FSBO but later they decided to include a realtor and upped the sales price 5,000

We negotiated back to 120,000 but the final sales price was 125,000 and we didn't see this error until a year after when we renovated and wanted to refinance.

How did you finance this deal?

Traditional bank loan.

How did you add value to the deal?

After a year we renovated the property to add a bedroom. We paid the full renovation costs from our savings accounts (Somehow we managed to save even though we were minimum wage earners). The AHV got appraised to 150,000.

What was the outcome?

We refinanced the deal after the renovation. Instead of taking out cash, we got better interest rates as well as monthly payment went down quite substantially.

Lessons learned? Challenges?

Always read contracts, even the papers you have signed can alter in the final draft.

Ask for permission from the town if you do renovations. This didn't cost me this time but would it of been intentionally done they could of fined us quite heavily.

Make a contract in paper with your contractors. One of the contractors send us an invoice half a year later with a 7 day payment period. We thought we had already paid for his services.

There's a lot of tax deductions in renovating your home.

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

Our local bank lender, she's nice to work with. If anyone in my home town wants her name feel free to PM me. Also the contractors who were in hired for the staircase as well as the main renovation guys were good people. We got lucky and will share their info with others.