First off, I am just as nervous about most of this COVID-19 stuff as everyone else. However, fear of the unknown can’t scare me away from a great deal!

I am an experienced investor with 13 years under my belt. I mention that because if you are inexperienced, I wouldn’t recommend you do what I’m about to describe that I did.

Recently, I bought four houses—none of which I’ve been in. Yes, that’s correct. I did not enter the houses before closing—or after.

One of the houses will be my personal residence. I bought it based on square footage and the price. After the wholesaler accepted my offer, I then drove by the property to see my future residence.

But I’m getting ahead of myself. My house was the third of the four I purchased. Let’s get into the first two properties first.

Why I Bought Rental Properties During the Coronavirus Pandemic

The first two properties were rental properties that were undervalued. A wholesaler brought them to me, and I knew these were GREAT deals right away.

Here’s why:

• They were already rented out.
• Property management was in place.
• They had $100K worth of equity on the ARV.
• And the best part… they were under $50K to purchase.

I called around to get funding. Unfortunately, it was difficult due to a lot of lenders pulling out of deals because of COVID-19. I finally found a lender at Carolina Hard Money that was still lending. They were able to smoothly close the deals.

Related: Rates Are Historically Low, But It’s Extremely Hard to Get a Loan—Here’s Why (& What to Do About It)

The terms were hard money rates, however. The key is to take them down. I normally refinance into longer, cheaper money anyway.

(Side note: If you are not familiar with the BRRRR strategy I strongly recommend you read up on it on BiggerPockets.)

These properties are intended to be long-term holds in a newly appreciating market.

Why I Bought a Primary Residence During the Coronavirus Pandemic

The next house I bought was a primary residence. I’ve been wanting to buy a new primary, as I am eligible to get tax-free capital gains on the sale of my current house. Prior to this, I had just never found the right property for me.

A wholesaler bought this deal with me in mind before sending it to me. When he sent it, I was concerned that right now no one is buying because of COVID-19 and most off-market deals in that neighborhood were not moving because they are at top-of-the-market prices.

But I gave in and looked at it. I had done a flip on that street before. However, according to my recollection, the street was a little rough. I wasn’t sure I wanted to live on it. We haggled on price, and he accepted.

I rode through the neighborhood to see what was going on. There was a lot of improvement, but it wasn’t all the way there yet.

I did know new and rehabbed houses were selling for $200/square foot, though. Online it said this house was a 3-bed/2.5-bath and 1,300 square feet. The wholesaler provided me pictures and said the listing was wrong—it was actually 1,600 square feet and five bedrooms.

Related: Don’t Let a Recession Stop You in Your Tracks: 5 Key Ways to Dodge Momentum-Killers

The house was rented at $1,200 to a tenant paying month to month. So, I figured if the house was either 1,600 or 1,300 square feet, I couldn’t lose either way at a purchase price of $135K.

So, 10 days later we closed on the property. Currently, I am working with the tenant to ensure a positive future for them.

Why My Most Recent Investment Was Irresistible

The last house I bought was another rental—the price was too good to turn down. I wanted to hold off on purchasing right now, but the same wholesaler who sold me the first two properties brought me another home run deal: It was rented for $750, had a $50K asking price, and property management was in place.

I had to pull the trigger ASAP. And I even got the deal cheaper than asking.

Apparently, he had it sold, but other buyers pulled out due to coronavirus. Those investors had intentions to flip it. Personally, I wouldn’t get into a flip in this climate.

The Bottom Line

In conclusion, no matter the market, deals will always be around. Three out of these four properties I bought for return—not speculation.

A lot of people think those who fix and flip make a lot of money; however, flippers take great risks to get their checks.

I don’t know about you, but I wouldn’t want to have a $500K-plus house to retail right now (even though in Charlotte, North Carolina, retail sales are currently very strong).

Regardless, anything priced above the first-time homebuyer price point is very risky at the moment. Just remember, when you buy on returns, it’s harder to lose on the investment.

Are you buying deals despite COVID-19? Why or why not? 

Join the discussion below!