Investment Info:
Townhouse buy & hold investment in Centennial.
Purchase price: $293,000
Cash invested: $21,000
I bought this 2 bed/2 and a half bath townhouse in April 2019 not thinking too far out into the future. Then it dawned on me a few months ago. I need a house! And then I need more houses. So, I'm working on improving my credit and savings. I'm hoping by this summer I'll be ready to refi my townhouse into a rental property and buy a single family for myself and my two daughters. But! They will be out of the house in about 6 years. So! I need to think about the future and how I can turn our soon to be new house into several houses every year into the future. My girls are also interested in real estate. I think one would be great as an agent, the other would be great at design. i want to build a legacy real estate empire with them!
What made you interested in investing in this type of deal?
I had to get out of a one bedroom one bath apt with my two daughters. This deal came along at the right time.
How did you find this deal and how did you negotiate it?
I found it on the Mls. It was already on the Mls for at least 30 days if I recall and it was listed in the dead of winter. The seller didn't necessarily have to sell so I paid asking before someone swooped in. It's a fixer upper no doubt, it had hardly been touched since the 80's.
How did you finance this deal?
Initially FHA with I think 3.5% down.
How did you add value to the deal?
After about year I refinanced. Long story short, due to the lender making some serious mistakes during the refi process they paid for the refi appraisal, all closing costs and the loan officer contributed her/his commission because of the mistake. The loan officer's mistakes wiped off my PMI. During this time I remodeled the kitchen and baths. So I ended up knocking off $250 per month from my monthly mortgage payment.
What was the outcome?
See above. Also, this purchase was a purchase of a pig with lipstick. Ugh! The prior owner made some horrible improvements that will cost me more to fix than if he would have just left the property as it was.
Lessons learned? Challenges?
I could have spent less on the remodel of the kitchen and baths. I should have found a way to scrape the popcorn ceilings before we moved in. But we were moving out of an apartment into the townhouse, we didn't have another place to go. So. We will either have to suffer living through popcorn ceiling removal and complete flooring removal/installation or wait until we find a new home. Once we move, then we complete the ceiling/flooring etc? Unless we move into another fixer,then what?
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Yes, my agent is my best friend. Oh yeah, she gave up her commission for the sale in order to help me out. She only charged the amount that she had to pay to her brokerage. She works 24/7. I will be happy to pay her full commission in the future for all of my future investment purchases.
