Most Recent House Hack in Boston!

[Nick Riccio]

Investment Info:

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

Purchase price: $840,000
Cash invested: $185,000

Purchased a two family with 5% down FHA. Purchased as a 4 bedroom 2 bathroom. Converted to a 7 bedroom and 4 bath two family as we expanded one unit into the basement. Just appraised at $1.375M. One unit currently rents for $6,000/month and our unit (when moved out) should rent for ~$3,200.

Total rent roll should be ~$9,200

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

Major value-add opportunity. Were able to add additional living space to the basement!

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

This was on MLS. Listed for almost $100K over what we ended up paying.

How did you finance this deal?

We financed this with an FHA loan 5% down. Had to complete a couple of repairs prior to close due to FHA requirements. Seller let us go in and complete the repairs so that we could close!

How did you add value to the deal?

Added 3 bedrooms and a bathroom to the basement. Added an additional bathroom in the second unit. Total add of 3 beds and 2 baths and about ~900 square feet of living space

What was the outcome?

Added about $500K in equity. Took the expected rent from ~$2,400 to $6,000 per month!

Lessons learned? Challenges?

This was a large project and during covid made it even more difficult (of course was out of our control).

Adding space to basements can be tricky, had certain window requirements and egress requirements we needed to meet.