All Forum Posts by: Adam Briceland

Investment Info:

Single-family residence buy & hold investment in Milwaukee.

Purchase price: $137,500
Cash invested: $69,997

Single family home, purchased using the capital from my now business partner to house hack. Went from renting out a room for 450 per month plus 100 for the entire garage and 50 for use of an additional bedroom for storage. To now 1200 for the entire house all from the original tenant.

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

To no longer be a renter

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

Walking an open house

How did you finance this deal?

Traditional loan with a local bank

How did you add value to the deal?

Kept renting out rooms, lived in the basement and keep the place clean and updated

What was the outcome?

Have moved out and have since bought a duplex, closing on a second duplex in two weeks and my business partner bought himself a duplex to live in a year ago.

Lessons learned? Challenges?

Screen your tenants and don't be in a rush to get someone in. You must cash flow 450 or more a month to weather any kind of unpredictable event. Don't spend the money laying around from your cash flow either. Invest in something gaining interest. Use the interest to grow your OH S##T fund and at the end of the year pay yourself and your business investor a small dividend.

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

I work with Dawn K. from Shorewest who knows what properties I'm looking for. Michelle T. with Associated bank is who I turn to for financing. KWK electrical contractors and Chris the Plumber do great work and are easy to get scheduled. Tim the owner of Right Way Renovations gets the random jobs done right and on schedule. Troy Beasley is very a knowledgeable home inspector. Extremely detailed in his evaluations and would highly recommend him.

Hey John I think this is a great topic to discuss.  So I'll let you know what I have done with my house and why I feel it's both a place to call home and an investment.

First off I bought my house with a business partner.  He put 50% down and I financed the other 50%.  We then both put 5k into a bank checking account for any major expenses.  We call it our OH S#$T account. So we keep a minimum of 10k in this account at all times.

So this allowed both of us piece of mind because each of us wanted to buy a house but didn't like the risk we would be taking on. The risk was caused by putting a down payment which can be 3.5%-20% depending on which way you go. (Or 0% if you are a Veteran and get a VA loan). Which would leave the monthly payments high so our monthly rent income wasn't covering much. Or if we put more down then it left little in reserves.

So the added bonus of this house is the basement is I'd say 75% finished with a standing shower and bathroom.  But they are separated and on the opposite sides of the house so the house is listed as a 1.5 bath.  So I saved on it verse a 2 bath house.  My business partner and I live in the basement and rent out the 3 bedrooms upstairs.  The kitchen, living and dinning room are all up there and so is the full size bathroom.  I also rent out the 2.5 car garage. The basement has a small countertop of both sides of the basement and small cabinet space.  Just enough room for a microwave and a two burner cook top.  Oh and there is a refrigerator in the wall as well. 

I'm living for free, so is my business partner.  Then we share half of the yearly home insurance cost, we alternate paying the tax bill each year, split repair costs 50/50 and pocket around 230 a month in extra rent income. 

I plan on living in it for 5 years minimum.  We call it home base.  Because the mortgage payment is so low, if everything goes south we can always come back to it. Slowly we will finish the basement and eventually move out and turn it into a full out rental.  Then do the same to a four plex.