Investment Info:
Small multi-family (2-4 units) buy & hold investment in Austin.
Purchase price: $177,000
Cash invested: $20,000
Sale price: $325,000
My first real investment. A 2/2 duplex in north Austin. Best investment ever! But I was scared to death. It was a fabulous learning experience all the way around. I bought, rehabbed, managed, and sold with little outside help. I made a ton of mistakes but worked my butt off and cashed out nicely. The experience taught me the value of building a team and reserving cash for repairs, and the whole experience eased my fears. As Marie Forleo says: "Everything is figureoutable!"
What made you interested in investing in this type of deal?
I love multi-family properties! And I was looking for a path out of the rat race.
How did you find this deal and how did you negotiate it?
MLS -- I winged the whole thing, paid full price with 3% down and paid PMI, but it worked out nicely in spite of my being a naive amateur.
How did you finance this deal?
FHA hard lender
How did you add value to the deal?
Rehabbed property cosmetically -- cleaning, painting, new fences, garage doors, lighting, faucets, A/C units, appliances and landscaping.
What was the outcome?
I raised the rents from 800 to 1250 on each side over the six years that I was there and cashed out at $325K. I stated that I put in $20K honestly I don't know the numbers. Lesson learned
Lessons learned? Challenges?
Lessons learned: always maintain cash reserves for maintenance/repairs, fire bad contractors pronto, be friendly with renters but not friends, a decent buyer's agents do not make a good seller's agent, I must always keep my thumb on the numbers and eyes on the contractors, and as with anything else -- you get what you pay for when it comes to contractors
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Julie Black at Starkey Mortgage was my mortgage broker and she was amazing!
