Investment Info:
Single-family residence buy & hold investment in Longview.
Purchase price: $165,000
Cash invested: $5,000
Almost completed New Construction single family rental. Will rent for 1,650. Its located in Hallsville, Texas.
(First deal) and many more to come!
What made you interested in investing in this type of deal?
New construction is something some of my family has done, and they were able to mentor me along the way. Which is a huge help. I'm also very familiar with this market, and this is the area I grew up in.
How did you find this deal and how did you negotiate it?
Got the house plan from a family member, bought the lot in a good subdivision close to local family there (boots on the ground).
How did you finance this deal?
New construction loan. The bank (credit union in this case) appraises the plan, based on all your estimates, including land, construction cost, and permitting. The give you up to 80% of appraised value. The goal is to build each house for less than 80% of the appraised value that the bank is willing to loan you. Reason be, you can virtually do all deals with very little, to no money down.
How did you add value to the deal?
I brought money to the deal, as well as the will to learn everything I can.
What was the outcome?
House will be completely finished by the end of march.
Lessons learned? Challenges?
Building can be challenging, but it is not near as hard or difficult as people make it seem. There can be tons of money in new construction. Its essentially a reverse BRRRR deal.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
East Texas Professional Credit Union. They did great, I'd highly recommend them. Builder's name is Bob White from 127 Builders. He's top notch. The bank was happy to lend money knowing that he was going to be the contractor. If you'd like more information regarding his work or information I'd be happy to share it, or give you references.
