Investment Info:
Single-family residence buy & hold investment.
Purchase price: $275,000
Cash invested: $10,000
I purchased a 3/2 Single Family Home in Naples, Florida that has an efficiency in the backyard. I am currently living in the efficiency and fixing it up while renting out the main house. The rent from the main house covers the mortgage and utilities. Although it is not cash flowing much yet, usually between breaking even and $100/month, not having a primary living expense has been very beneficial. I also plan on renting out the efficiency with short term rentals eventually.
What made you interested in investing in this type of deal?
I knew that I wanted to do a house hack considering I have experience with it from when I was in college. I am less interested in flips at the moment, I am looking to build an investment portfolio of rentals starting in the South Florida area. While the prices were high, I was fortunate to close when I did as they have continued to rise.
How did you find this deal and how did you negotiate it?
I actually found it on Zillow and showed my Realtor. We started roughly 15% under asking, but were competing with a cash buyer so it didn't take long for that to go up. I was very fortunate that they pulled out once we hit the original asking price, and I was able to close right at $275K.
How did you finance this deal?
I obtained a loan through my current employer, Guaranteed Rate.
How did you add value to the deal?
I am building sweat equity into the home via upgrading the efficiency in the backyard. I am doing whatever I am able to do on my own and subbing out the work that I am not able to do.
What was the outcome?
It is still a work in progress, but I am very happy with my tenants in the front house and I am loving not having a primary housing expense outside of paying myself rent to cover Capital Expenditures.
Lessons learned? Challenges?
I learned that I need to stop trying to be so frugal by doing some of the larger jobs myself and just pay professionals to do it. I wanted to do a lot of the work myself because I enjoy that kind of work and I wanted to learn how to tackle a lot of the issues that may come up in the future.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I worked with David Polarek at Guaranteed Rate as my lender, he made the entire process quick and painless. I actually was hired by Guaranteed Rate while I was in the process of closing on this property and now originate loans for them on my own with David as my mentor.
