All Forum Posts by: Cody Smith

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $106,000
Cash invested: $700,000

I bought 3 buildings as a package deal, 1-3 unit,1-4 unit,1-5 unit

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

The same realtor who sold me my first 2 unit mentioned this property to me. I brought it up to the partner I had on my first 2 unit and we became partners once again.

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

The same realtor and business partner who was involved in my first 2 unit property. The owner was a slumlord and the property was priced at almost $200,000. I negotiated the price to $106,000 based on the required renovations.

How did you finance this deal?

Business partner acted as the bank on this deal and I would be in charge of hiring contractors for the renovations.

How did you add value to the deal?

More of a life lesson than a value. I partnered with someone once again that gave no guidance. I was in over my head with no way out. The quotes I had from licensed/certified/reputable contractors was too high for my partner. My partner hired a fly by night handyman to do the project who was not qualified, in my opinion, to make toast. My $300k quote quickly turned to $700k when finished.

What was the outcome?

I own this building with this partner. We have a management company manage it. We overpaid for the renovations but the property pays for itself with no loss of cash. This could have been a cash cow, and I know one day it will.

Lessons learned? Challenges?

Lessons - don't be afraid to fire your partner, no matter how much money they have. Trust your gut. I let my age convince me that everyone else was right and I was wrong.

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

Yes. No.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in York.

Purchase price: $90,000
Cash invested: $14,000

2 unit apartment building.

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

I read Rich Dad Poor Dad when i was 18. I partnered with a family member who was already into real estate investing. That partner paid the upfront money to close and I managed the property. Not knowing what I was doing, and not getting any coaching, I learned through trial and error. I still own that property today and its been by far a better learning experience than any college course I have ever taken.

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

I found this deal on the mls. I had no idea I could negotiate. Again, no help or coaching. So to me, the price was the price. I bought it wrong from the start and have since learned some valuable lessons.

How did you finance this deal?

FHA financing. I "lived" in 1 unit and rented out the other. My partner was the up front cash and I held the mortgage.

How did you add value to the deal?

Not sure if I added value back then. I was enthusiastic about real estate and I had a long term goal in mind. Little did I know the changes that woudl take place over time.

What was the outcome?

I still own the property. It makes a small profit every month. The lessons learned with owning this property has been priceless.

Lessons learned? Challenges?

Lessons - Learn to negotiate, educate yourself, fail fast-fail often-fail forward, learn from your mistakes. Don't let someone else write your story.
Challenges - no one takes a 19 year old seriously and not having credentials to back me.

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

Yes. She is no longer in the business.

Investment Info:

Single-family residence buy & hold investment in York.

Purchase price: $35,000
Cash invested: $3,200

Single family home I bought as a package deal with another property. I bought both homes for $35,000 with a line of credit. I cleaned up the "junk" property and sold it for $10,000. I now have the good property that is rented and cash flowing approx $500 per month.

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

I liked the idea of flipping 1 property with little to no work and applying that $10k to purchase of the good property.

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

I work with many investors in and around the York area. This deal was presented to multiple buyers who are heavily invested in this area. I was the first person to get the properties under contract contingent on getting a quote for flipping the junk property. If the quote was too high I could walk away from the deal. I knew i was going to do a quick flip with this property and sell it to another investor with doing little to no work.

How did you finance this deal?

Line of credit

How did you add value to the deal?

cleaned out the junk property to make it more appealing to the next investor

What was the outcome?

bought 2 properties and sold 1. Took the proceeds from the junk property and applied to the line of credit to free up my cash.

Lessons learned? Challenges?

Lessons learned - the smallest steps add up to the biggest leaps
Challenges - convincing myself to go for it. I'm glad I took the chance

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

I was the real estate professional and yes I would recommend myself ;)