Loooooong Term Rehab

[Daniel Kinney]

Investment Info:

Condo buy & hold investment in Orlando.

Purchase price: $37,500
Cash invested: $17,000

This is a property (Spacious 1BR/1BA) we purchased just after we got married with approx. a $2k down payment. My wife was renting it for about a year & half prior to marriage, and once I I moved in, started talking to owners to see if they would sell to us as our first family home purchase. They initially said no, but after some negotiation (4 months) we settled on the sale price, and they agreed to hold the loan (seller financing) for a 30 year note at a fixed 5% rate. Since purchase, we have renovated much of the unit, except the kitchen, for approximately $15k. I would estimate the sale price in today's market would be circa $85,000.

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

My wife and I were renting the unit and we really wanted to own something for ourselves so that we were "paying ourselves" with the idea that one day it might become a rental. Also when the seller agreed to seller finance the property we were sold!

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

We were renting the property and just started to establish a relationship with the owner who liked us both. Initially they were uninterested in selling, but said eventually said yet.
For the negotiation they asked for 42,000 and I showed them comps and it was out of order so they came down and said that they would also finance the purchase for us. So we did that. :)

How did you finance this deal?

Seller Financed

How did you add value to the deal?

We rehabbed the property over the past 4 years we've owned it.

What was the outcome?

We still own the property and it will soon be a rental.

Lessons learned? Challenges?

We learned that doing a live-in renovation can be exhausting, but worth it in the end. We also learned to ask for referrals for contractors from people you trust.

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

We did not work with any agents on this deal, but a realtor friend of ours has a slew of professional contacts. Her name is Crystal Jenkins with Remax out of Orlando FL.