My First House Hack..Hawaii single family turned into a duplex

[Kevin Chisholm]

Investment Info:

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

Purchase price: $488,000
Cash invested: $8,300

Was a single family home in Hawaii I bought specifically to turn into a single level duplex. The original horseshoe shape made splitting it into two unit fairly easy.

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

I knew I could convert it into a duplex fairly easily and make affording living in Hawaii that much easier

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

I found it when I was called to give an estimate to fix it up so they could sell it...I went by a few months later and talked to owner who said they decided not to remodel it but sell it as is...so I made an offer and they accepted it.

How did you finance this deal?

Regular bank financing . I paid for the remodel/conversion out of pocket.

How did you add value to the deal?

The house had not been painted or remodeled in 30 plus years...it ha shag green carpet and tiny kitchen. I gutted and redid the entire property over the coarse of 8 years and converted it to a duplex.

What was the outcome?

I now rent out both sides of the duplex and the money I make each month pays for 2 acres of land I bough down the road and build a tiny home on.

Lessons learned? Challenges?

Dont trust banks..the put me into 2 mortgages literally at the last half hour of my closes. The original loan was with one bank, at the last second they said they found a better deal and switched it over to 2 different banks, so I ended up with a first and second that was $160 less then the original single bank loan. So I didn't question it...in 5 years my once great mortgage jumped to over $5k, because it was thru 2 different banks no one would refinace me. Lucky NACA did, and I save my house.

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

Not a single one...I feel like they were all actually working against me. While this wasn't my first home purchase...it was certainly my most expensive purchase at nearly $500K. I felt like I was out of my league and they could smell it on me.