Investment Info:
Single-family residence buy & hold investment.
Purchase price: $237,500
Cash invested: $61,000
Started the first year and rented at $2,350. Tenants didn't stay so I turned into an STR.
Already secured a tenant for 6 months at $4,000/month for the furnished place
What made you interested in investing in this type of deal?
It was in a great area, that was turning from B to B+. Appreciation was expecting. Other than that, it was close to the 1% rule for a property above $200k, which makes the impact of repairs and maintenance somehow less impactful.
How did you find this deal and how did you negotiate it?
I found the deal on the MLS. PM advise me against it since in his opinion it would not rent at $2,350 as my agent was suggesting.
I had already done two deals at the time with that agent and trusted her knowledge of the market. She was right!
Another aspect that made the deal interesting was that it came with an extra lot, which I can parcel off at any time and recover the whole initial downpayment. Lot value is approx $70-80k
How did you finance this deal?
25% cash downpayment with a conventional loan
How did you add value to the deal?
The value add came one year later, when I converted from long term rental to Short Term Rental. I went from $400/month cash flow to $1,500/month!
What was the outcome?
So far so good. I've the first STR tenant in, even if they signed for 6 months at $4k/month
Lessons learned? Challenges?
The extra lot will come valuable but the main lesson learned is to invest in great area! You can do so, when out of state, by having a great team and trusting the right people
