Investment Info:
Small multi-family (2-4 units) buy & hold investment in Payson.
Purchase price: $225,000
Cash invested: $7,875
We house hacked this Duplex for four months.
We closed on this property on August 4 and got the keys on August 5. Our first mortgage payment was in October, which we more than covered with the rent from the other unit. The second payment in November was also covered from the rental income. By the beginning of December, we had been living "rent-free" since august and had saved up enough for our next property! So we moved out in the last day of November, and had it occupied on the first day of December.
This duplex has had 0 days vacant, the only money we have put is a small down payment, and maybe $300 all together in repairs.
What made you interested in investing in this type of deal?
I was sick of paying rent and wanted to subsidize a mortgage, didn't realize it was called house-hacking when i first did it!
How did you find this deal and how did you negotiate it?
My RE agent found it, we offered $5k more than they were asking, as long as they covered all closing costs and made a list of 8 repairs.
How did you finance this deal?
FHA Mortgage. 3.5% down payment, at 3.725% interest.
How did you add value to the deal?
Added a washer and drier to each unit, garbage disposal to the basement unit. Provided a lawn mower and weed-eater for tenants to take care of lawn.
What was the outcome?
When we bought this duplex the basement was rented for $600 and upstairs for $650. We moved into basement and raised upstairs rent to $700.
The basement is currently rented for $950 and upstairs for $850 (longer tenured tenants).
Lessons learned? Challenges?
In hindsight I wish we would have stayed her longer and saved up even more cash for our next deal, but i'm happy about the current cash-flow. Challenges have been the last tenant in the basement, kind of rushed to get them in after we moved out - they never missed a rent payment but were late every single time for the last four months they were there.
