Norfolk VA Cash Flow Buy and Hold turned to Flip

[Collin Blackburn]

Investment Info:

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

Purchase price: $247,000
Cash invested: $67,000
Sale price: $360,000

We bought this turnkey property for the ~$1800 monthly cash flow. Over the two years we owned it, the rents stayed the same but the property appreciated by almost 50%. Our ROI was great, but our return on total equity in the property had gone down significantly. We decided to sell to free up the cash.

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

Cash flow and potential appreciation in the area because of the St. Paul's Area Revitalization.

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

This deal was on the MLS. It was fairly priced so we offered full price.

How did you finance this deal?

Conventional Investment Loan

How did you add value to the deal?

The property was rehabbed when we purchased it.

What was the outcome?

Great cash flow for the two years we owned it and a significant increase in purchase price when we sold.

Lessons learned? Challenges?

We had a few lessons learned on this property:
-Return on Investment vs. Return on Equity
-Speculating on price increases is a lot less stressful when you have significant cash flow
-Renting to Section 8 tenants was not an issue to us at all

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

I worked with my wife, Remi Blackburn, who is an agent.