Small success story - new rental

66 Replies

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

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!

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

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

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

@Dawn Anastasi  Are a majority of your rentals out of state?

@Dawn Anastasi  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?  

@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.

Congratulations Dawn.

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

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

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

Sounds like a great deal! Well done.

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

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

What neighborhood of Milwaukee is this located?

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.

@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.

@Dawn Anastasi  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.

Dawn,

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

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.

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.  :)

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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