Single family Homestead turned lease investment

[Mike Downing]

Investment Info:

Single-family residence buy & hold investment in Houston.

Purchase price: $163,500
Cash invested: $30,000

Bought it for $163,500, worth around $300,000 today and cash flows $700 monthly. First investment property. Owned for 6 yrs. Currently owe $140,000. I take all the cash flow and put it towards the principal.

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

Started off as a Primary home, then became a good cash flowing rental with positive equity.

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

FSBO in front yard... driving the neighborhood, saw the sign, walked into the garage where the owner was. Asked the price, it was clearly a deal and signed a contract on the spot.

How did you finance this deal?

FHA 30 yr

How did you add value to the deal?

Added 30k General Contracting myself to make the house go from not nice to nice.

What was the outcome?

Great, I feel like I am going to own this forever... until I am ready to cash out.

Lessons learned? Challenges?

Contracting can be hard... construction can be hard. Being prepared is key.