Home Run BRRRR in Cleveland (Garfield Heights)

[Mike Trzaska]

Investment Info:

Single-family residence buy & hold investment in Garfield Heights.

Purchase price: $22,500
Cash invested: $55,500

This was my second full BRRRR. Cash invested - $55k, Appraised Value - $128k, Rent - $1150/mo

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

This was my best friend's Dad's house and I spent a lot of time here growing up. I actually think I drank my first beer in the basement.

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

I found the deal because my friend reached out to me after seeing I was doing some investing through Facebook/Instagram. His Dad had some health issues and had a tenant in the property that was taking advantage of the situation. My friend had the tenant evicted we agreed on the price, and I actually got him to seller finance 80% of the purchase price. This was my first off market purchase and my first seller financing transaction.

How did you add value to the deal?

The place was a mess, but structurally in good shape. Over three months we cleaned out the place, replaced all flooring with LVP, painted everything, installed AC, replaced the furnace, renovated the kitchen with new SS appliances, and cleaned up the landscaping.

What was the outcome?

I used a property manager for the first time as well (found on BP). He got the place rented for $1150/month within 4 months of acquisition, he actually had to raise the price due to so much interest.

During the refinance the house appraised for $128k, I was totally shocked and feel it likely only worth $115 at the high end. With that appraisal I pulled out around $80k after paying my closing costs, and profited over $20k while holding property that will cashflow >$100/Mo after all expenses.

Lessons learned? Challenges?

I continued to develop systems on my 3 previous deals, and only spent about 20 hours working on this deal. Looking forward to see how outsourcing property management works!