Here we go! Been saving up for the last couple of years to pull the trigger. I lived and worked in NYC until October 2020. I’ve wanted to break into real estate for forever. Dabbled in BiggerPockets here and there to learn a bit. I still have so much to learn but decided to jump in the deep end.
Pandemic hit and left the city down to sunny Florida. Started looking around down there until one of my buddies, now partner hit me up with a deal in Wildwood,NJ. So packed my stuff, got my money in order and headed north.
We found a 5 unit building 2 blocks from the beach that we figured could have some potential. It was seller financed with some eager sellers. My partner did all of the walkthroughs before I even came north and got our inspections done. It needed a lot of work. But we knew that. I had never seen the building until the day I signed the papers. I trusted what my buddy had to say about it. So we bought it “as is” and boy are we in for some work. I’ll get to that.
So we gathered our lawyer and offered them a deal. Remember this was seller financed as we couldn’t go through a bank and get a mortgage. I started my own company less than a year ago and my partner has a large savings plus some cash jobs. He always was let go from his jobs during the pandemic. Nonetheless we took the jump. We trusted what we were getting into and know how much we could afford and spend.
So the terms. We purchased 5 units for 332k in a seller financed deal. All paperwork done by lawyers and holding companies. We put 15% down. Slightly less than $50k. Totally forgot what the lawyer fees and titles fees were. My partner handled that. I think it was in the ballpark of $2-4k. We got this deal on a 3 year ballon mortgage at 4.75% with a 30 year amortized monthly pay schedule. All monthly payments go directly to the seller. Clock is ticking!
Now about the house: We have four 2 bedroom units with identical layouts on either side of the house. And a 3rd floor attic apartments with another 2 bedrooms. We also have 2 bedrooms and a half bath not connected to any of the apartments. You can access them from the main staircase in the front of the house. The old owners rented out the rooms as SROs to the migrant workers who came for the summer seasons. The owners lived in North Carolina and from what I was told were never present. So we also learned when we bought the house that there wasn’t just a single person in these rooms. They had bunk beds, multiple beds, they even closed off the living rooms and made those in extra rooms. To say the least there has to be a ton of people in here at once.
Back tracking to our inspection report like I said we knew what we were getting into. There wasn’t any major structural damage to the house but it does need a whole lot of TLC and BST. We have our money to renovated and bring this building back to life and bring it up to code. Since it’s 5 units we’ll have to eventually get a commercial mortgage.
It’s exciting. It’s scary as a first time home buyer. But I’m absolutely loving everything so far. We’ve been here for 2 weeks just cleaning the place out. We’ve already filled a 2 ton dumpster and my backyard looks like an episode of hoarders.
I’m tired of writing and I’m sure some haven’t even read this far but I’ll be back to update the whole process.
Can’t figure out why it’s sideways. I’m the one in the glasses. I also wrote this from my phone so that could be it.
