All Forum Posts by: Ken Wang

There is few trick to buy from HD or Lowe’s. You can join the pro program or you can buy their coupon from eBay ( don’t ask me how they generated). You can still buy online from HD or Lowe’s.they have more choices.you can also return in local stores. 

@Courtney Rollins thank you for your encouragement !

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Baltimore.

Purchase price: $115,000
Cash invested: $87,162

Contributors:
Ozzy Sirimsi

Baltimore duplex (row house: 1st and 2nd floor is the 1st unit, basement is the 2nd unit, legally zone duplex )

Total cash invested: $87,162 Breakdown -->
Downpay: $28750
Closing cost: $13682
Rehab + misc cost: $40370
Holding cost: $4360

What made you interested in investing in this type of deal?

Great location close to Johns Hopkins Bayview hospital, and upcoming Bayview area

How did you find this deal and how did you negotiate it?

Close to where I work, talk to the neighbor, and found this deal sale by owner;

First time buying from the homeowner, who was quite difficult to deal with. The closing cost is quite high because we covered almost all the expenses. I should also negotiate the purchasing price lower.

How did you finance this deal?

conventional finance, and 401k

How did you add value to the deal?

Although it is a legally zone duplex, the owner used it as 1 unit rental. We finished the basement as a 2nd unit. The rent is increased from $1200 (single unit) to $1900 (2 units)

What was the outcome?

1. The rent is good with room to increase, and reserve for raining day
2. Great location -> appreciation potential and easy to find good quality tenants

Appraisal price after all the work as of 09 2019: 166k - 171k

Monthly rent: $1050 (2 bedroom, 1 den, 1 bathroom, 2-floor unit)
$850 (1 bedroom, 1 bathroom, basement unit)

Reserve: Vacancy 8.3%, Repair/cap ex: 12%, PM 10%, PITI: $737

Lessons learned? Challenges?

1. After the contractor finished the basement bathroom, I noticed the shower drain was not smooth. I was hesitating if I should ask the contractor to fix it because they gave me several reasons not to do it. Glad I insisted, and it saved me much trouble later.

2. Oil heating system needs much time and effort to take care of it

3. Electric is separated meter but gas, water, oil heating are shared. It needs more involvement in terms of management

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Thank you BP member @Ozzy Sirimsi to work with me for this deal!
I hope through this post. I can connect more people to get next deal!

@Lamont Marable thanks a lot for your generous offer , I will message you

@Nick Winikoff sorry for the late reply. I ended up buying a duplex in baltimore city. The income is good. By comparing the pro and cons between room rental and multi-family, for room rental, you may get more cash flow but it requires more time to manage it. Although I currently manage my property, later I would like to switch to PM when my portfolio increases. In this case, I don't know which PM will manage room rental for me... In the end, I didn't do room rental, since I have a quite busy day job.  hope it helps

Don’t forget Homedepot and Lowe’s. Of course they could be expensive but one trick I used is that you can go to eBay buy their coupon (don’t ask me how they generated these coupons). The coupon could be 10-20% off. If you buy cleareance items + these coupons. They are good price. I go there buy a lot stuff together, either ask they ship or ask contractor pick up. For appliance , you can also try sears outlet. 

I am wondering for baltimore city or maryland, what is the most important factor that appraiser uses to assess the property value? sq footage? condition? thx!

I would be very careful to check if it is legally zone duplex. I have one duplex. Beside the reason stated above, there are also other reasons such as interest rate /insurance difference between single and duplex, rental license for single or duplex ... etc.

I do hear the story that city caught the case for the single row house remodeled for duplex and fined the owner for rental purpose.

Hi @Horacio Gutierrez, I am wondering do you have any update to share your experience for mashvisor or other related website?

 Hi Ben, do you guys also manage duplex but with single water and gas meter?