All Forum Posts by: Sarah Bull

Investment Info:

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

Purchase price: $330,000
Cash invested: $82,500

This buy and hold duplex is located in Fayetteville, AR. These are hard to come by these days! This is an investment property that will yield a 6.42% cap rate. It was a financed deal with 25% down and an ROI of 7.52. Estimated current market rent is 1,200 /month. It was built in 1994 and has a unique layout with very separate, woodsy backyard spaces and covered decks. It's is a great investment neighborhood, steps from the University bus line and city trail system.

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

With the housing shortage and crazy growth that is happening in NWA, there are still deals to be found. It takes patience, perseverance and aggressive offers to make it happen. One unit was vacant and was able to be rented at current market value right away. The other unit was rented to a long-term tenant and will be brought up to current market rent over the first year. Rents continue to increase to try and keep up with the rising home cost so the return will continue to increase over time.

Investment Info:

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

Purchase price: $330,000
Cash invested: $82,500

This buy and hold duplex is located in Fayetteville, AR. These are hard to come by these days! This is an investment property that will yield a 6.42% cap rate. It was a financed deal with 25% down and an ROI of 7.52. It was built in 1994 and has a unique layout with very separate, woodsy backyard spaces and covered decks. It's is a great investment neighborhood, steps from the University bus line and city trail system. Estimated current market rent is 1,200 /month. With the housing shortage and crazy growth that is happening in NWA, there are still deals to be found! It takes patience, perseverance and aggressive offers to make it happen. One unit was vacant and was able to be rented at current market value right away. The other unit was rented to a long-term tenant and will be brought up to current market rent over the first year. Rents continue to increase to try and keep up with the rising home cost so the ROI and cash flow will continue to increase on this investment over time.

Their investment goal was to move their cash from another home sale in Colorado to an appreciating home in NWA to grow their wealth over time, as well as enjoy a positive monthly cash flow and tenant principal pay down. (This is the rest of the post :-) ) 

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $205,000
Cash invested: $205,000

This buy and hold investment is located in a small town in what used to be "off the beaten path", near Fayetteville, AR. The explosion of growth in the Northwest Arkansas Area and associated appreciation rate and home price increases, coupled with not enough available homes for the demand, has led to growth in all the surrounding towns. Prairie Grove has become a viable place to invest and it is still possible to find homes in the lower 200's.

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

This was a cash deal at 205,000. The home was owner-occupied so we were able to move new tenants in and capture rent at current market value right away. It is leased at 1,495/month, bringing a cap rate of 6.13% and an ROI of 6.07. The monthly cash flow on this property is $1,047/month. This home was well cared for with one owner, so there was very little cost in getting it rent-ready following the purchase. A real honey for my clients! Their investment goal was to move their cash from another

Hi Cody! Nice to meet you. I am a native to NWA and work with investors from all over the country to find good investment properties here in NWA. I'm always up for talking real estate!

Hey Jennifer, nice to meet you! I personally have not leased this way, but am familiar with the concept through my working relationship with a property management company in our area that does this type of leases. I know it has become a more common option in our area. The neighborhood this deal is located in is perfect for it! I am sure my contact would be happy to discuss the lease details with you and his experience with this type of investment. Let me know if you want his contact info and I'll message it to you directly. 

Thanks Will! Builder was Trademark Homes.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $366,500
Cash invested: $73,300

Investment property near the University of Arkansas. Built in 2020, should be minimal upkeep for a few years. 4 bedrooms are leased to college students. The monthly rent is 2,800 ($700 per student). This investment has a cap rate of 6.88%. The cash-on-cash return, after a 20% down payment, is 10.11%. Monthly cash flow after expenses is $660. Couple these returns with the high appreciation rate of the area (NWA experienced 14% appreciation rate during 2021) and it's a good one!

Lessons learned? Challenges?

There is a higher monthly HOA fee that cut into the monthly cash flow a bit. This HOA fee is to completely take care of everything outside the home, good for college students and the preservation of the curb appeal and value of the investment.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $366,500
Cash invested: $73,300

This Investment property is located in a college-oriented neighborhood near the University of Arkansas. Built in 2020, there should be little to no upkeep for a few years. The 4 bedrooms will be leased individually to college students. The monthly rent is 2,800 ($700 per student). This investment projects a cap rate of 6.88%. The cash on cash return projection, after a 20% down payment for a 30-year note at 4.25% is 10.11%. The monthly cash flow after expenses is $660. There is a higher monthly HOA fee that cut into the monthly cash flow a bit. This HOA is to completely take care of everything outside the home, good for college students and the preservation of the curb appeal and value of the investment. Couple these projected returns with the high appreciation rate of the area (Northwest Arkansas experienced a 14% appreciation rate during 2021 and an average of 13% over the last five years) and this turned out to be a good investment!