First Deal - Simple Strategy of Buy and Hold

[Irish A.]

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $130,000
Cash invested: $43,000

Goal with the first OOS rental was to find a SFR that was primarily rent ready or required light rehab by Summer of 2021, with the criteria minimums of $200 pure cash flow, 10% CoC return, purchase price around the $125k range that met the 1% rule.

Backstory:
This property was listed on the local MLS as "coming soon" and I reached out to the listing agent directly to see if they were entertaining early offers. As soon as the listing agent got back to me, I had my agent write up an offer that was my highest and best offer.

Numbers:
Financed 20% down conventional
Listing Price - $125k, Purchase Price - $130k, Appraised for $133k
Seller Credits - $3k
Rehab - $13.4k
All in - $43k
Current rent - $1300
Pure Cash flow - $260, CoC Return - 9.7%

Lessons Learned:
1) Don't get too caught up with the numbers - Started analyzing deals in this market in February and found properties that were very close to my minimum criteria. But did not make my first offer until May mainly because when I analyzed deals, it was either $20 below the minimum or pure cash flow was 1% below minimum. In hindsight, I not only lost time but potentially money as well as the recently sold home prices were rapidly increasing.

2) Triple check everything with the lender

3) Learn to balance providing a good quality home with staying within rehab budget

4) Long distance RE investing really is simple. First deal doesn't have to be a home run and it is really meant to build confidence and momentum for the next one.

5) Be kind and show respect to each person you meet, and the reciprocity of abundance will come back ten-fold. Keep it simple and don't overcomplicate things :)