Investment Info:
Single-family residence buy & hold investment.
Purchase price: $206,200
Cash invested: $2,000
I hadn't heard of BiggerPockets or even house-hacking when I bought my first home, but I knew I didn't want to throw money away on rent. I got three friends to move in with me for very cheap (they were being my guinea pigs after all). Although, it didn't cash flow, I was able to live rent-free, build equity, and gain experience as a landlord. I have since gotten married and discovered real estate as a vehicle for early retirement. Next, we'll finish the basement to rent separately.
What made you interested in investing in this type of deal?
I didn't want to throw money away on rent and I wanted to start building equity.
How did you find this deal and how did you negotiate it?
My dad drove past the For Sale By Owner sign in his neighborhood.
How did you finance this deal?
A conventional 30 year loan at 4.5% interest with a 3% down payment.
How did you add value to the deal?
My dad helped me frame a fourth bedroom in the basement and I contracted out the electric and drywall for about $1600. Afterwards I was able to rent out three bedrooms which paid my mortgage.
What was the outcome?
I had renters pay my mortgage so that I could live for (almost) free in my own house.
Lessons learned? Challenges?
I've gained experience in the first time home buying process, working with contractors, and being a landlord. I see the value in a turn-key investment, but also see how I could have made a better investment by finding a better deal.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
My mother, Debbie Emmons was my fantastic Real Estate Agent!
