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Small success story - new rental

66 Replies

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Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

posted over 4 years ago

I brought aboard a new rental property recently (rented for September 1st).  It's a 3 bedroom, 1 bathroom cape cod. The primary reason I purchased this property was the neighborhood.  I really liked how nice it was and I got to know the neighbors and they're really great too.

Purchase price = $31,500

Rehab = $6,000 (approximately)

Work done:

+ Painting all rooms in the house (needed primer to cover ugly colors) + ceilings and trim

+ New rainfall tub/shower faucet + plumbing

+ New ceramic tile tub surround and tile base around the room

+ New toilet

+ New glass block window in the bathroom

+ New windows in the entire house (except for large picture window), double-pane vinyl windows with tinted UV protection

+ Basement laundry tub plumbing repairs

+ New water heater

+ Drywall replacement in upper bedroom around stairwell

+ New outlets and switches in all rooms

+ New light fixtures in two rooms

+ New kitchen floor (sheet vinyl) also used on back hall and stairs to basement

+ Miscellaneous (some new cabinet handles, smoke detectors, CO2 detectors, door knobs, new locks, curtain rods, curtains, light bulbs, grass cutting and gutter cleaning)

Rented out at $875/month + utilities.

The tenant I have is actually one from one of my other rentals.  Her son turned 18 and decided to move out, and so now it's just her and her 2 daughters, and they didn't need all the space of the 4 bedroom place they had been renting (at $1100/month).  The new place is less than a mile away from the old place, so it worked out for her with the move as well.

Some pictures (I'm horrible at picture taking so please don't laugh):

BEDROOM 1

BEDROOM 2 (UPSTAIRS)

BEDROOM 3

KITCHEN

LIVING ROOM

BATHROOM

BACKYARD

Kristine J.
  • 3 posts
  • 0 votes

Kristine J.
Virtual Assistant from --, -----

replied over 4 years ago

Congratulations Dawn! What a perfect opportunity you had & turned it into a profitable success! : ) Let me know if you are interested in any other investments. Take care!

Roy N.
  • 7.4K posts
  • 3.9K votes

Roy N. (Moderator) -
from Fredericton, New Brunswick

replied over 4 years ago

@Dawn A.  

Nicely done ... as usual.

Dawn Brenengen
  • 2.1K posts
  • 1.2K votes

Dawn Brenengen (Moderator) -
Real Estate Broker from Raleigh, NC

replied over 4 years ago

Sounds like a great deal, @Dawn A.  ! Good job!

Ryan Dossey
  • 3.3K posts
  • 2.0K votes

Ryan Dossey
Real Estate Broker from Indianapolis, IN

replied over 4 years ago

@Dawn A.   did you guys do the work or contract it out? Looks nice!

Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

replied over 4 years ago

I installed a couple doorknobs and did a bunch of cleaning, and hung the smoke/CO2 detectors.  I hired out almost everything else.

Ben Leybovich
  • 3.9K posts
  • 3.4K votes

Ben Leybovich
Rental Property Investor from Lima/Chandler, Ohio/Arizona

replied over 4 years ago

Nice!  I have a cape cod that looks exactly like it (I think they all look same).  You will do well with it Dawn.

Taylor Chiu
  • 192 posts
  • 50 votes

Taylor Chiu
Investor from Salt Lake City, UT

replied over 4 years ago

Wow, what a steal! Thank you for sharing this level of detail, it's really helpful for us newbies.

@Dawn A.  Are a majority of your rentals out of state?

Marcia Maynard
  • 3.5K posts
  • 3.8K votes

Marcia Maynard
Investor from Vancouver, Washington

replied over 4 years ago

@Dawn A.   Beautiful!  Thanks for sharing the details.  Such a pro!

Jim Sestito
  • 258 posts
  • 92 votes

Jim Sestito
Investor from Canton, MA

replied over 4 years ago

@Dawn A.  Congrats on the new place, numbers look very solid.  Quick question, Dawn - why certain high end upgrades like the rain shower head and the tinted windows?  Is this to make your rental stand out from others in the area or are they the area norm?  

Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

replied over 4 years ago

@Taylor C.  my rentals are all in Milwaukee where I live.  I don't invest out of state.  I like the area where I invest, so I stay here.  :)

@James Sestito  the rainfall shower head I got on sale, and it was actually only $10 more than a "plain" shower head. For $10 I may as well make it "pop".  And the contractor was able to get a deal on the windows where the tint was no more cost than the non-tinted variety.

Overall I like getting the best quality and useful features if I can pay no more or only a little bit more.  There is the saying "it's only a rental" but you also have to keep in mind that if you want to sell the property in 5 years, those little extras will appeal to a retail buyer.  I don't plan on selling in 5 years, but who knows?  If someone threw the right number at me I would sell.

Arnie Guida
  • 299 posts
  • 122 votes

Arnie Guida
Residential Landlord from Greenfield, Wisconsin

replied over 4 years ago

Congratulations Dawn.

Thanks for continually providing the inspiration for me to improve my way of doing business.

Cal C.
  • 1.6K posts
  • 1.0K votes

Cal C.
Investor from Peachtree Corners, Georgia

replied over 4 years ago

Great Job Dawn!  How much do you expect the utilities cost?

Bill Larsen
  • 150 posts
  • 63 votes

Bill Larsen
Investor, Real Estate Agent from San Juan Capistrano, California

replied over 4 years ago

Wow, great deal!  What types of marketing do you do to find these?  

Austin Lee
  • 408 posts
  • 115 votes

Austin Lee
Investor from Waynesville, North Carolina

replied over 4 years ago

Sounds like a great deal! Well done.

Isaac Schulman
  • 26 posts
  • 4 votes

Isaac Schulman
Investor from Brooklyn, New York

replied over 4 years ago

Looks beautiful! How did you finance the property? How long did the rehab take?

Lokesh W.
  • 158 posts
  • 6 votes

Lokesh W.
from Milwaukee, Wisconsin

replied over 4 years ago

Congratulations! Looks great and you do take great pictures as well :)

What neighborhood of Milwaukee is this located?

Larry T.
  • 1.4K posts
  • 806 votes

Larry T.
Flipper/Rehabber from Rochester, NY

replied over 4 years ago

Wow, that looks great!  And you really got a lot of bang for your rehab buck!  Nice job!  Can I ask what the cash flow is?  I assume it is much than my area as I'd could expect about the same purchase and rent price but the taxes would be outlandish.

Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

replied over 4 years ago

@Cal C.   the utilities are paid for by the tenant (which is what I meant by $875/month + utilities) so it would depend on how much they used.  Generally water is $125-$150/quarter for 2 adults.

@Isaac Schulman   I did not finance the property. I paid cash for the property + the rehab.  The rehab was about 2.5 weeks.  I personally spent about 6 hours cleaning which this property desperately needed.

@William Larsen I did not do any marketing. This property was on the MLS and open to anyone. It had been a foreclosure and had been vacant about 2 weeks I think before I saw it.

@Lokesh W.   I buy all my properties on the NW side of Milwaukee. This house is 2.2 miles from my own house.

@Larry T. the house cash flows about $500/month after property taxes, insurance, repairs/CapEx reserve, and vacancy reserve. I do my own PM so if you were to subtract another 10% for PM you'd be at $412.50 per month. Keep in mind that this is a lot more than $100/door because I paid cash.

I also forgot to add to the list of things I did was replace the side door on the garage and have it painted.

I will be adding about $300 to the mix this month to put in a new garage door opener as my regular guy was on vacation. The garage door itself is fine, but the tenant has to manually open and close it.  That will be inconvenient in the winter time.

Aaron Wyssmann
  • 252 posts
  • 116 votes

Aaron Wyssmann
from Springfield, Missouri

replied over 4 years ago

@Dawn A.  That is a great deal.  I can see where the detail of what you do makes a big difference.  I'll look forward to seeing your next deal.

Deborah Smith
  • 80 posts
  • 36 votes

Deborah Smith
from Phoenix, Arizona

replied over 4 years ago

@Dawn A.  - great find and job!  Thanks for sharing the details with us.

Minh Le
  • 2.0K posts
  • 3.0K votes

Minh Le
Investor from San Jose, CA

replied over 4 years ago

Dawn,

As usual, you're killing it.  Congrats.  Was Mehran part of this deal?

Elijah Artman
  • 46 posts
  • 26 votes

Elijah Artman
Investor from Sacramento, CA

replied over 4 years ago

Dawn, You're awesome. Such a great inspiration for me.
are you the one interviewed on the podcast in summer of 2013? if yes, incredible. 
Thanks for sharing your experience.

Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

replied over 4 years ago
Originally posted by @Minh L.:

Dawn,

As usual, you're killing it.  Congrats.  Was Mehran part of this deal?

Mehran gets a lot of great properties.  This time I bought one for myself.  :)

Dawn A.
  • 6.1K posts
  • 4.0K votes

Dawn A.
Rental Property Investor from Milwaukee, WI

replied over 4 years ago
Originally posted by @Elijah Artman:

Dawn, You're awesome. Such a great inspiration for me.
are you the one interviewed on the podcast in summer of 2013? if yes, incredible. 
Thanks for sharing your experience.

 Yes I was on Podcast 29.

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