My first home purchase: 3 Family home house hack

[Seth Bronko]

Investment Info:

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

Purchase price: $178,000

3 family home house hack. I remodeled the first floor and moved in with my wife. The rents from the 2nd and 3rd floor cover all our mortgage/insurance costs.

We bought with an FHA and 203k construction loan. Purchased for $178,000 with $35,000 of remodeling

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

I knew I wanted to take advantage of FHA opportunities and buy our first home as an investment property. We bought the house with the intention of living there for a short time and keeping it as a rental property

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

I found the home on Zillow and asked our agent to see it. The house was in disrepair so we made and offer and ended up getting the house a little under what the seller was asking.

How did you finance this deal?

We financed the house with an FHA and 203k construction loan. We were all in for about $7,000 out of pocket. The sale price was $178,000 and we did $35,000 worth of renovations

How did you add value to the deal?

My construction background allowed us to maximize renovations

What was the outcome?

We've lived in the house with our rents covering all our mortgage/insurance costs. When we move we will be able to rent our unit for approximately $1,200/month gross cash flow.

Lessons learned? Challenges?

Seemingly small maintenance problems (cracked window 45 ft up in the gable in the back of the house) could lead to big problems if not addressed right away. A family of squirrels managed to get all the way up to the attic through the window and make a home. Being an old 1900 balloon-framed house, the squirrels were able to run up and down the walls. I had to have all the squirrels removed then promptly fixed the broken window.