Bank owned duplex converted to vacation rental in Neptune Bch, FL

[Ian Brown]

Investment Info:

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

Purchase price: $432,000
Cash invested: $150,000

Bank owned duplex purchased and converted to upscale vacation rental. Property is 2 blocks from Atlantic Ocean in the heart of beaches entertainment district.

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

I lived in the area and almost NO bank owned multifamily every hit the market

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

It was auctioned off on auction.com

How did you finance this deal?

Private fix/flip money from Lending One

How did you add value to the deal?

Conversion from typical run-down beach rental to fully-renovated and furnished luxury vacation beach rental

What was the outcome?

Property is now worth $800k+ and has $2,000/month cashflow after all expenses and debt service.

Lessons learned? Challenges?

Auction process is cold and indifferent, no real negotiation opportunity. Challenge was working through a stale/cold auction.com process without any opportunity to use soft-skills or get very creative in up-front contract phase.

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

I represented myself, which allowed me to keep buyer's brokerage on my side of ledger and reduce my cash to close.