Not a homerun, but first deal complete!

[Mitch Kennedy]

Investment Info:

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

Purchase price: $89,900
Cash invested: $23,380

1 bed 1 bath downstairs and a 2 bed 1 bath upstairs. Separately metered.

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

Listed on the MLS. Listed with tenants in place, photos made it look like trash, which is probably why it sat on the market for 2 months. By the time I checked it out the tenants had actually moved out and the units were in pretty good condition!

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

Listed on the MLS. Listed with tenants in place, photos made it look like trash, which is probably why it sat on the market for 2 months. By the time I checked it out the tenants had actually moved out and the units were in pretty good condition! Ran the numbers and asking price made sense... There was 1 other offer coming in so I just offered asking.

How did you finance this deal?

Funded by me through a 20% down conventional loan

How did you add value to the deal?

Cosmetic updates. Flooring, light fixtures, vanity, new tub/shower surround, counter tops, paint, painted cabinets, tore down old wall paper. etc.

Estimated $5k for cosmetic updates all done, came out to ~$5,500. Overage due to a crack in one of the shelves of the tub/shower surround (Missed this during my walk throughs). I hired someone to replace the moldy drywall behind the shower and put up a new tub surround.

What was the outcome?

Previous tenants rent totaled $925. After the updates I made, I'm renting the property out for a total of $1,300.

COCROI: ~20%

Lessons learned? Challenges?

-Rehabs take way longer than you think....
-They say not to rent to family or friends. I would also add friends of family or friends of friends to that list.
-Building more relationships with handymen/contractors before tacking my next property is a priority