All Forum Posts by: Amy Kendall

Investment Info:

Single-family residence buy & hold investment in Springville.

Purchase price: $200,000
Cash invested: $20,000

This property is a very large twin home that was one of our first purchases we made after deciding to really go all in on rental properties. At this time, saving for the down payment was our biggest holdup and we used a 10% down payment loan from MACU to get into this property. The cash on cash return for this property is probably the highest we have seen while investing here in Utah. The same renters have been in this property since we bought it and it has been a great property for us.

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

We were really excited to start adding to our portfolio at the time and this property fit all our criteria.

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

We found it on the MLS. The sellers wanted a little more for it, and we initially lost the bid to another buyer. Then, a week later, the agent called us to see if we were still interested and they accepted our original offer.

How did you finance this deal?

We used a 10% down payment loan through Mountain America Credit Union, which really helped us out because our limiting factor at the time was coming up with money for the down payments on properties.

How did you add value to the deal?

We painted the cabinets and finished a bathroom in the basement. The furnace went out a week after closing on this property, which gave us some concern, but it worked out and has been a great rental.

What was the outcome?

We are still holding onto this unit and recently refinanced the loan.

Lessons learned? Challenges?

This one gave us a few problems right out of the gate with that furnace and a few other little things, but we stuck with it and have some great equity built up with steady cash flow.

Investment Info:

Townhouse buy & hold investment.

Purchase price: $186,000
Cash invested: $36,000

This was a new construction townhouse 3bed/1.5bath with a 2 car garage located in Provo. The cash flow isn't great on this property, but it has been easy to rent with no maintenance expenses in the last two years. The appreciate has been incredible over the last few years. The current tenants are moving out at the end of this summer, and these have increased their value to about $245,000. We plan on selling it after they move out and doing a 1031 into a bigger multi-unit property.

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

I like the low maintenance that townhomes have to offer with no upkeep to the outside of the property.

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

We found this on the MLS. It was one of the lowest priced townhomes at the time and prices were increasing fast. We got in on phase 1 of the project and within a few weeks, they were all reserved and the next phase released with a price increase of 20k!

How did you finance this deal?

Just a traditional 30 year fixed mortgage

How did you add value to the deal?

We did upgrades to the cabinets, the countertops, and had some vinyl plank flooring installed.

What was the outcome?

We plan to do a 1031 into a larger multi-family property at the end of this summer and put the equity we have gained into better use.

@Priyaa Kalyanaraman The market in Salt Lake City continues to be hot with a lot of demand for single family homes.  Cash flow is not is strong as it was a few years ago, but you can still acquire a property that does produce some positive cash flow and there are a lot of positives to the market here.  A lot of realtors would do a walkthrough video of potential properties for you.  Are you familiar with any of these areas you mentioned?  I have had investors from out of state come into the area and tour around to become familiar with the area first and then feel comfortable enough to not come back once they have a property under contract.  If you have a team that you trust, then I think that would be possible.  Also, when I have invested out of state, I have always found talking with property managers has been helpful because they can offer you advise as to potential rents and the quality of the area and the property without being connected to the deal.

That's a tough call.  You should definitely understand anything that you invest in, so never stop learning and growing because that will only benefit you in the end.  I haven't ever partnered with family before so hopefully someone who has will have some good advice on how they set it up to avoid hurt feeling in the future.  But if it helps you get into something a lot quicker than if you are on your own and you start saving money on your living expenses sooner rather than later, then it could be something to seriously consider and research further into partnering and everything that entails.  Good luck!

You did it!  Congratulations!

You can always post your deals here in the forums and people will help you with the analysis as well.  Also, try and analyze 5-10 deals a day so that you get familiar with what is normal in your market.  Then, when they present you with a possible deal, you will have a baseline to compare it to.

They can be really strict, especially in traverse mountain with single family homes. Last time I called on behalf of an investor, they gave the thumbs down. Your safest bet is to call the HOA directly on any potential rentals you have.

Sounds intriguing!

You  could also look into converting it into a self directed fund.  If it is through your company, you might not be able to change it, but it is worth looking into.  There are some limitations, but it would potentially allow you to invest in real estate with your retirement vehicle, while still getting the benefits and not having to pay any withdrawal penalties.

I've been lucky enough to not have a devastating bad investment, but last year we did purchase two new duplexes out of state and had quite a few issues with the builder.  The timeline was an issue, and he ran out of money and couldn't finish, so we released 20k from escrow to help finish the project.  He was supposed to also landscape the property once the snow was gone, but he never did that.  The deal could have easily fell apart at so many places, and we could have been really bitter about the whole experience, but instead we kept on going and ended up with a two great, new, cash flowing properties.  We did end up paying a landscaper to finish that up.  I sincerely feel like if you plan ahead and have enough reserves, then what could be the most miserable experience for another investor might just not be as bad for you.