All Forum Posts by: Nicolette Ponce

Investment Info:

Townhouse buy & hold investment.

Purchase price: $399,990
Cash invested: $4,000

This is a townhome in a great neighborhood in Gilbert, AZ that has opportunity for value add via renovation & is very rentable as is. With approximately a 4% vacancy rate and a great demographic area, I'm optimistic about the long term performance of this buy & hold.

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

A single family rental seemed like a good place to start as a beginner investor, and it's proving to be both eye opening and manageable as a first investment. We can only go up from here!

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

This was actually listed on the MLS. It was listed at about $50K below market value at the time. I am an agent so I represented myself and my husband in the deal. We negotiated the typical way for on market properties, with inspections etc. I was able to negotiate a credit for the roof that was needing repair and we were also able to get favorable seller financing terms.

How did you finance this deal?

The seller financing terms were 20% down then payments amortized over 30 years, with a balloon payment in 3. We negotiated a 6% interest rate, which was about 1-2% lower than we could have gotten with a bank, and 2-3% lower than hard money.
We raised the downpayment by working with a private lender who agreed to lend us the money and be repaid at the time we refinance, no interest!

How did you add value to the deal?

Currently renting it out as is, but plan to renovate to bring the value up to par with comps in the area.

What was the outcome?

Holding & renting so far.

Lessons learned? Challenges?

Our numbers looked okay, but we're breaking even on the cash-flow. There were some factors I could have calculated differently like cap ex in particular. But I'll do better due diligence next time! I learn by doing, so no shame here, just lessons and growth.

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

Myself :) Just kidding, but really I would love the opportunity to help you find your next deal here in the valley of the sun.