I recently purchased my first real estate deal recent as of 6-14-18. The property is in a small town and is a 4 unit apartment complex that needs lots of attention. My brother is a contractor and him and I will be doing the vast majority of repairs. Getting funding wasn't the easiest as it was a construction loan on a property that I wouldn't be living in. I was able to find a bank, First Financial that would work with me. I got the property bought for 57,700 it had been repossessed by the bank. I also got funding for the renovations of 64,100. The appraisal of the property was 150,000 so when all said and done with the project I will have equity in it. We are already underway on doing the renovations but I felt like this was still a good opportunity to share where I am at so far. Any questions feel free to leave them below and I'll try to answer as quick as I can. Bigger Pockets has definitely expanded my knowledge of real estate in general I never would have guessed all the different avenues that exist to invest in real estate.
Congratulations, John. Based on the numbers you got a great deal. Like yours, my first multi-family was a 4-unit and well and it cashflows like a beast (and I never even raised the rent on the inherited tenants (two units - the other two units were vacant)).
How did you find the deal? Was it listed as a foreclosure on the MLS?
It was listed on the MLS and I watched it drop 10,000 a month for several months before I put in my offer to purchase it. Mine is completely vacant as the bottom had water damage in years past and the previous owners gave up on fixing it; but not before tearing out everything leaving me just the studs to rebuild from on the bottom. The upstairs i'm hoping to have rent ready here in the next couple months!
A bit of an update for those interested at the beginning of this week I submitted for my first draw for the construction part of my loan this has been a learning experience! Between learning what a lien waiver was and educating a fair few of the folks ive been doing business with we got everything together and should be getting checks to pay everyone early next week! we have used about 22 percent of our renovation budget and basically have the top two units ready to be rented. The bottom ones are going to be a lot more work to get ready but we are making good progress!
Great work John. Im interested in buying my first 4 unit building as well and your post just enticed me. Im looking forward to the updates and hopefully photos.