Investment Info:
Single-family residence buy & hold investment.
Purchase price: $45,000
Cash invested: $2,000
We purchased this small 900 sf home from a friend that was building. He replaced the carpet (had three dogs that weren't house trained). We sealed the floor first, painted inside and out, did some minor repairs and it was move in ready. My elderly parents are in the home currently, when they pass we will rent the home out from around $650 per month.
What made you interested in investing in this type of deal?
It was really a need to move my aging parents closer to us. They could not sell their home, therefore had no money to relocate (terrible money managers). My sister and I live in Texas and they lived 12 hours away in Missouri.
How did you find this deal and how did you negotiate it?
The home is 1/4 mile from my home, so the owner was a neighbor and friend.
How did you finance this deal?
Bank Financing
How did you add value to the deal?
Minor updates and removing the dog pee smell was major! We cut down some dead trees from the front yard (that my step daughter called the Halloween trees). My parents have since done quite a bit of landscaping that greatly adds to curb appeal.
What was the outcome?
My parents make the house payment, we make no actual income from it, however it is in a great rental area and will continue to appreciate.
Lessons learned? Challenges?
A little elbow grease and paint will go a long way toward making a house more appealing. It doesn't take nearly as much money as you might think to make it rentable! As long as the structure is solid, the deal is probably doable (at the right price).
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
No agent involved, we used Texas Bank and Trust in Tyler, TX. They were made the process simple and painless.
