Investment Info:
Single-family residence buy & hold investment.
Purchase price: $180,000
Cash invested: $5,000
Single family home that we will be using the BRRR strategy with.
What made you interested in investing in this type of deal?
It was a great opportunity to get myself into real estate investing.
How did you find this deal and how did you negotiate it?
It was originally my aunt's house. After she passed away, my cousin squatted in the house and didn't pay the mortgage. My mom received a foreclosure notice in the mail one day. Instead of letting it get foreclosed on, I asked my bosses who were already real estate investors to help fund the deal to buy the foreclosure. They were generous enough to help me fund 100% of the deal and I would get 33.33% of the profits + any rental income on the property.
How did you finance this deal?
We created an LLC under the 3 of our names and bought the property under the LLC. My bosses funded 100% of the deal. I took care of some legal fees and the initial $1000 deposit for the closing. I also put in sweat equity to renovate the home after we bought it.
How did you add value to the deal?
I help project manage the renovation and was able to provide them with an off-market deal they wouldn't be able to find initially.
What was the outcome?
We renovated the house for around 20K. So total all in was around 200K. We are now renting out the property for $2150 a month with great and clean tenants. Just signed off on another 2-year lease with the current tenants.
Lessons learned? Challenges?
They put a lot of trust in me to project manage the house reno. But since it was my first time doing something like this. I didn't really know what to do and I wished I was more prepared with finding quotes and timing out the different contractors that had to do their jobs on the house.
We tried to save money on knocking up the tile flooring by doing it ourselves. It was much more difficult than it looked online and I ended up getting COVID from the experience.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
N/A
