It’s Finally Time to Buy My First Deal

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It’s Finally Time to Buy My First Deal

Connor Cushman
Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes

First and foremost, thank you to this community and so many individuals that have willingly paid it forward to help me get to this point.

A little personal history..

I discovered BP 3-4 years ago and have been hungry to buy my first deal since. I was a sophomore in college with no money, a little bit of debt, and a new wife (also a sophomore in college) that I needed to support.

After grinding through 3 more years of school, I finished my business/marketing degree from a great business school in 2019 and got a job at top technology company in the Bay Area.

The best thing I did during the last 4 years though was get my UT and GA real estate licenses. I did 4 transactions as a buyers agent in my first 6 months and learned a ton.

I finally now have money saved, solid W2 income, enough knowledge and experience, and my license in the market that I’m going to buy in.

The question..

Because my work is remote, I’m looking to buy in the north Georgia market (Suwannee, Cumming, Alpharetta Area), but can’t find any market multi-family homes.

Because multi-family properties seem to be non-existent, I plan to buy a single family 2500 sq. ft home with a basement apt. that can be rented.

The numbers look something like..

Home Price - 250k-300k

Basement rental rate - $1000-$1200

PITI - $1600-$1700

Entire home rental rate - $2000 ish

I worry that I’m not getting creative enough in the way I source my own deal. When I decide to move out of the home, I worry that I’ll basically break even renting the home to one family. Could I still somehow rent the upstairs and the basement even if it’s zoned single family?

I wonder if given all of the knowledge I have at this point, could I come up with something better here? I want to start this journey on a path that most likely leads to success.

Any advice, warnings, ideas for someone who’s about to dive in?

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Georgui Kasaev
Realtor · Athens, GA · Member since 2017 · 336 posts · 123 votes
6y

@Connor Cushman Thank you for sharing! Depending on the area and what is around it. Have you thought about renting by the room (works best near colleges) and or renting a portion of it out to traveling nurses? Or do a combination of the two? As far as zoning is concerned. Usually, zoning determines the type of property you are able to build in a particular area e.g. Houses in SF zoning, Duplexes, and up in MF zoning, warehouses in Industrial zoning. What determines if you can or can not rent to multiple tenants are usually county laws and neighborhood covenants, for example in Athens Ga we have a law on the Clarke county books saying that you are not allowed to rent to more then two unrelated people under the same roof. But as you can imagine with Athens being a college town there are a lot more than two unrelated people living in rentals most of the time. The county does not enforce that law and frankly, I'm not sure how they would be able to. I hope that helps. Reach out to me if you have any questions! 

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  • Betsey Biggs
    Member since 2020 · 11 posts · 0 votes
    6y

    Following, though I don't intend to rent the whole thing at any point soon. Are you seeing basements with a separate entrance? I'm finding that hard to find in the Boulder, CO area.

    0Reply
  • Georgui Kasaev
    Realtor · Athens, GA · Member since 2017 · 336 posts · 123 votes
    6y

    @Connor Cushman Thank you for sharing! Depending on the area and what is around it. Have you thought about renting by the room (works best near colleges) and or renting a portion of it out to traveling nurses? Or do a combination of the two? As far as zoning is concerned. Usually, zoning determines the type of property you are able to build in a particular area e.g. Houses in SF zoning, Duplexes, and up in MF zoning, warehouses in Industrial zoning. What determines if you can or can not rent to multiple tenants are usually county laws and neighborhood covenants, for example in Athens Ga we have a law on the Clarke county books saying that you are not allowed to rent to more then two unrelated people under the same roof. But as you can imagine with Athens being a college town there are a lot more than two unrelated people living in rentals most of the time. The county does not enforce that law and frankly, I'm not sure how they would be able to. I hope that helps. Reach out to me if you have any questions! 

    2Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Georgui Kasaev

    This is great advice. Thank you so much. I think it definitely makes sense to do some digging and find out how different cities in the area treat rental properties and how they enforce.

    1Reply
  • Matt Osojnicki
    Rental Property Investor · Boise · Member since 2020 · 5 posts · 3 votes
    6y

    First off, Congratulations! It seems like you have built a well rounded analytical mindset to buy and hold smart investment properties. 

    I am currently house hacking my first property in Boise and looking to buy my second in the next couple months. That being said, I understand the frustrations that come with a tough market and being a first time investor. My question to you would be are you dead set on the North Georgia market? I've been researching out of state investing, but it's hard networking long distance. It sounds like house hacking a 2-4 unit seems ideal in your situation?

    0Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Betsey Biggs

    Hi Betsey! In Georgia I do see a lot of walkout basements which is nice. In Utah I hardly see any so it’s not surprising that Colorado is similar. Good luck!!

    0Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Matt Osojnicki

    Hey Matt - Thanks and congrats on the first house hack! Are you finding good deals in the Boise market? I have family up there in Middleton and that market also seems tough right now! I am feeling pretty set on North Georgia because of how familiar I am with the area, it’s where I want to live, and I have a lot of relationships there that I think will be beneficial to my investing. To your point though.. worth looking elsewhere where I can actually find a multi-family property.

    0Reply
  • Alan Arena
    Cumming, GA · Member since 2019 · 12 posts · 2 votes
    6y

    Connor, I'm in Cumming (NoFoCo, actually. You can hear the banjos out this way ;-). We do have a house almost in Cumming with a detached apartment and RV garage that cash flows well, but have owned it for 10 years. Our current home has 2 basement apartments and a small house on the property, all rented. FoCo is great for appreciation, usually in the top ten places to live in the country depending on who's making the list. But hard on cash flow due to home prices. Our next purchase will probably be a SFR in Hall. Decent schools, a stable job market (driven by healthcare, teachers and general blue collar workers), and the ability to buy basic SFRs for under 200k make it attractive.

    All that to say, renting out part of a house is very do-able in the area. You might even find a place, probably outside a subdivision, that has a garage apartment or the space to add one. It could be worth paying a little more for such a property if it has unfinished space that can become rentable. 

    On another note, a few months back someone was selling one of those duplexes right off 400 at exit 15. It wasn't a bad deal as I recall.

    I'm sort of new to the rental thing and probably have more questions than answers, but I can tell you where the few, true multi-family properties are in FoCo.

    0Reply
  • Brandon Christensen
    Member since 2020 · 1 post · 0 votes
    6y

    @Connor Cushman proud of you man! I'm not surprised to run into you on these forums. This might not be a helpful reply other than words of encouragement.

    0Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Alan Arena

    Thank you so much for the advice, experience, and thoughts! All very helpful stuff. I will consider Hall as another option in my search.

    Any pointers on where true multi-family properties may be would be much appreciated!

    0Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Brandon Christensen dude love this. Thanks for the comment! We should catch up soon!

    0Reply
  • Alan Arena
    Cumming, GA · Member since 2019 · 12 posts · 2 votes
    6y

    Here are the small (ish) multi-fams that I know about. I’ve never seen much south of exit 14, mostly clustered close to town and built in the 70s-80s.

    Antioch Road, across from Atlanta Pools. 16 units across 4 buildings. There is also a small apartment building on the next plot to the north.

    1400 Pilgrim Mill Road. I believe it’s 4 buildings. Could be as many as 50 units total.

    Oakland Street and the area surrounding (close to exit 15). Quite a few duplexes and other small rental in there. Also at least one small complex.

    11th, 12th, and 13th street next to Central HS. There are several duplexes and I’m pretty sure at least one quad stuffed in there with some tiny houses.

    Kelly Mill just west of the town square. There are several groupings of rentals in there (look up 334 Kelly Mill in tax records for an example) that have duplexes. Also nearby on Tolbert, behind the fairgrounds and off W. Maple in that same area.

    Castleberry just south of Hutchinson. I think it’s a quad. This one sold a year or so ago. Mid 200’s maybe?

    Hutchinson, just off Castleberry there’s a 20 unit, I think it’s 5 buildings.

    There are probably a few more tucked here and there, but mostly close to town.

    0Reply
  • Rashaun ForrestPro Member
    Investor · Atlanta, GA · Member since 2020 · 54 posts · 20 votes
    6y

    @Connor Cushman hello Connor, I would suggest a ranch with basement that can be converted into an additional unit. I’ve done many of these for clients in the past. Easiest and cheapest way to create a duplex. Dm if you need help finding one that works.

    1Reply
  • Max Versteppen
    Member since 2020 · 113 posts · 33 votes
    6y

    It's been a great time to buy a house. Starting in mid-2019 and extending through early 2020, low rates lead to record affordability. ... We're seeing that what's “good” for rates can be bad for lenders, and what's “good” for the market can be bad for home buyers.

    0Reply
  • Connor Cushman
    OP
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    6y

    @Rashaun Forrest thanks so much for the comment. Do you mean that you can legally turn the ranch into a duplex or just set it up so that it functions like a duplex?

    0Reply
  • Rashaun ForrestPro Member
    Investor · Atlanta, GA · Member since 2020 · 54 posts · 20 votes
    6y

    Hey Connor, legally of course. Which is why you have to hunt for the right property but they are out there, less people looking at this type of property than turnkey multifamily 

    0Reply
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