Out of state in Mississpi!

[Nicole Galchutt]

Investment Info:

Single-family residence buy & hold investment in Madison.

Purchase price: $170,000
Cash invested: $42,500

3/2 SFH Renting out to a section 8 voucher holder for $1650/mo

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

The city requires a rental license for long-term rentals so the market is not flooded with rentals. Section voucher limits for a 3/2 are at $1700 so the numbers work. Being long distance this area is pretty easy to fly to via Jackson and the maintenance is low in this southern area. Having a section 8 tenant for long distance and self managed seems to be lower risk and working at very well so far!

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

After studying the area for some time, I connected with a great agent and went out there to look at some properties and get a better fell of what I wanted. Once that home hit the MLS we put in a full price offer and snagged it.

How did you finance this deal?

Conventional 25% down (could have done 20% but got a better rate with that extra 5% down)

How did you add value to the deal?

It was pretty turn key basic home. I just needed to get the city license which was a bit of a process but got it.

What was the outcome?

Getting nice direct deposits from section 8 monthly and have a very happy tenant that is so grateful to have her kids attend the schools in that area as they are top notch.

Lessons learned? Challenges?

I had thoughts of updating the home but at the end of the day I would have gotten the same rent if I have a section 8 voucher holder so I wasted a bit of time researching updating costs that were not needed. I have learned what the city looks for in their inspections for licenses, after failing the first inspection and needing a second I feel confident when I purchase another rental there on what is needed to pass the first time around.

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

Worked with a great agent that I would be happy to pass on. Lender was not so great so actually went out and got my license here In Oregon and will be adding MS to my states I can lend in and so will be my own lender on the next deal there.