PV Mall Hold, Appreciate, Then SELL!

[Cara Lonsdale]

Investment Info:

Single-family residence buy & hold investment in Phoenix.

Purchase price: $215,000
Cash invested: $35,000
Sale price: $385,000

Original 1970s 3/2 single level block home in great location near PV Mall, which is in the beginning stages of redevelopment. It had a great cul-de-sac lot with alot of potential. Inside it had formal living and family rooms, with a kitchen that opened to the family room. There was an exterior laundry room that had been added to the house with an interior door to access, but there was no ventilation or air going in there. So it was HOT, and it make the family room hot if the door was left open. There was wall paper in some rooms, curtains in the bathroom.....all original, and all dated.

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

PV Mall was a great area back in it's day, but the bigger and better malls that have been built around the area (Desert Ridge, Kierland) left PV Mall in the dust, and it was on it's way toward dying on the vine. When news came that it would soon be sold to be redeveloped, we took this as a great time to buy something nearby and hold it. The goal was cash flow in the present with appreciation growing to sell in the near future.

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

This was a traditional MLS listing. It had multiple offers. We bid over asking price and were awarded the house.

How did you finance this deal?

Traditional financing with 20% down.

How did you add value to the deal?

This property went through 2 remodel phases. The first was a quick turnaround in 2017, right after closing, to get it rent ready. light rehab, remodel of the baths, flooring, and painting. Second was in 2020/2021 where we completely remodeled the kitchen, redid both bath vanities, painted again inside and outside, and a complete backyard landscaping overhaul.

What was the outcome?

Great lot became a beautiful lot as well! Great curb appeal. PV Mall is in the works of redevelopment and is going to be designed after the outdoor malls surrounding the area, which are beautiful marketplaces. So, this will be a great area, and the time was right to sell.

Lessons learned? Challenges?

We originally decided not to remodel the kitchen because the cabinets were still in great shape, but just old. The problem is that once we started making everything around them new and beautiful, the cabinets started looking BLAH. So, on the second remodel, we completely redid the kitchen. We should have done that the first time, but it all worked out.

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

I am an agent.