Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $230,000
Cash invested: $57,500
I was fortunate to come across this listing on the MLS and submit an offer within the first week. It was initially listed at $199,000 but it was pretty clear that it was going to sell for more and after analyzing the property I had my agent put in an escalation clause for up to $230,000! It's a duplex of 2 bedrooms, the first floor has a gorgeous recently rehabbed kitchen and bathroom while the second floor has some space to increase value when it comes to both of those spaces.
What made you interested in investing in this type of deal?
I live down the street from this property so I'm very familiar with the neighborhood and what rental rates are going for. In addition, it'd be easy to manage if needing to drive no more than 5 minutes to get there. I've looking for 2-4 family properties as that's what my first purchase was.
How did you find this deal and how did you negotiate it?
The deal was found the tradition way. My agent created an MLS portal and I reviewed it regularly until this one came up. There wasn't much negotiation. The offer included an escalation clause, an as is special agreement, and closing within a month, all desirable aspects for a seller.
How did you finance this deal?
This was financed through a cash out refinance I'd originally done on the property I bought which was a 4 family. The loan itself is conventional through a bank.
What was the outcome?
After buying it, I have already had the tenants renew at nearly $200/month more than what they were originally paying. At that point, I'll be bringing in about $500/month in net profit
