Duplex with a View of the River

[Alex Smith]

Investment Info:

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

Purchase price: $80,000
Cash invested: $24,500

Purchased this with a Construction loan, which required 25% down on the purchase price and then we were able to take draws from an additional $40,000 for renovations. We put about $20,000 into each unit. Placed tenants in both units (Each paying $1,200 a month) and then the initial loan + rehab funds were rolled into a conventional loan of $100,000.

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

Long-term investment with sweat-equity potential. We love fixer-upper properties

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

MLS- Foreclosure

How did you finance this deal?

Construction Loan with 25% down on purchase price. Bank allotted $40,000 for rehab then rolled it into one conventional mortgage when project was finished.

How did you add value to the deal?

Updated both units, added central air, gutted and refinished bathrooms with nice finishes like tile, added more cabinets and changed layout in kitchen

What was the outcome?

Both units rented and tenants love it and plan to stay a long time. The duplex post-reno ended up appraising for $200,000 so we have 50% equity in it already.

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

Yes

[Alex Smith]

Thanks for the tips @Scott Mac