Thanks everyone for all the help and info on this site. Today I closed on my first "intentional" investment deal. I am already an accidental landlord (and out of state), and an accidental raw land investor (from a move after my time in the Navy that didn't go as planned). Ran across a good deal on a 4plex with seller financing while looking for a flip project. Building has 4 one bedroom apartments that all need the carpets ripped out, new kitchens and complete paint jobs. Seller wanted 15k down but we agreed on 5k down and I would put in 3k rehab on each unit at the first vacancy. Convinced him I would rather put the down payment directly into the property and mentioned if he did happen to get it back, it would be a completely renovated building. 90k total plus 12k rehab over 4 units and a year or two timeframe, rents out for 400 per unit now. I think with a rehab I can bring this to 420-450 per unit. (2 have car ports). Not exactly 2% but close.
Thanks again for all the motivation!!!!
Sounds like a great Deal, congrats!
Do you have any pictures per chance?
I'd love to see pics too
Congrats, man! Yea, I would love to see some pics.
So they are already rented out. Some of them might not want to move anytime soon. If you get the right person in a one bedroom they can live there a very long time with that cheap of rent. Sounds like a nice deal but how is the roof and furnace?
Is it all on separate hook ups?
How long have the tenants been living there?
20k rehab to get $100 more a month?
so 20k for 1200 a year.
Is it possible to rehab all the units raise the rents to 500 and try to sell it for 145k or so?
This might be a good flip if you can get the rent rolls up.
Here are a few pictures.
Sorry about the multiple posts but my phone would NOT load more than one. So I am thinking about new Allure flooring throughout the entire units. Just seamless from kitchen, living and bedrooms. Wondering if I should take it into the bathroom too, or use a different flooring in the bath. Paint is not in bad shape but it is up first. Also looking at doing something with the kitchens. Any recommendations? Just counters or new cabinets too? I would love to install central air in all 4 units and get rid of the PTACs. Upstairs units will be easy, downstairs not so much. I think the best option for all 4 is going to be mini splits (luckily Im an AC guys and this will be the easy part). Units are separate meter for electric but not water. Roof is new.
Don't know the market in Athens, GA. But that house has good bones.
Good luck with it.
Very nice! 1 bedrooms are great. Tenants are stable, rarely move if you keep the place up. Lower wear and tear too. Regarding the Allure, it's pretty good for doing it yourself, but expensive. But you can keep costs down and free your time up to find other deals, etc. by finding a good floor man who will install some nice sheet vinyl. If you are replacing carpet in LR, consider a 4X4 ft vinyl landing. Do not replace the cabinets. They add charm, and are much sturdier than the newer ones. They will last forever. They are easy to clean and refinish. You may want to update hardware, if necessary.
If you have smokers in there, use a regular Swizzle floor mop (I think that's what it's called-- the ones with the replaceable cleaning pad) to scrub the cabinets and walls-- takes most of the nicotine right off. Paint the walls with KILZ oil base primer. Congrats. Looks like a keeper.
A+++. Hope you come talk about this deal at our next meeting for the Athens REI club. Always great to hear about good owner financing deals.
Would love to Ethan. Still on for 3/30 right?
@Adam Morgan : Congrats. really looks like a keeper
Yes, we are on to meet for March 30.
By the way, I got the quad across the street under contract. Guess we will be neighbors. Unless I wholesale to another buyer. I believe in this area since we manage 3 on the same street. [PROMOTION REMOVED]
The owner of the final quad next door to yours wants $150-160k, but not motivated to sell. Says it's been pumping cash into his wallet for years. Let's hope he gets it when the time comes.
Let's talk soon. There are guys that actually do deals and then there's everybody else. Welcome to the club!
@Adam Morgan , congrats on the buy and seller financing deal. It's been a while since I've been to Athens for more than just a ballgame. Could these units be used for student housing?
As far as flooring goes, I like to use a laminate in my living rooms/hallways, loose lay vinyl in kitchens and baths, and carpet in my bedrooms. I try to lay it out where I can pull up and replace one piece of carpet, vinyl, etc. and replace without having seams. That way I dont have to replace all of the carpet if a piece is ruined by a tenant.
On to the cabinets. It's hard to find cabinets built as well as the ones you have now. What I like to do is remove the doors, sand down the face of the frames, and paint white. I have my cabinet guy build new raised panel or shaker style doors out of 1 piece mdf. Usually it costs me $500-$700 per kitchen and it gives an updated look with hidden hinges. Add new counter tops and your done. With the size of the kitchen you have pictured, it should be even less.
Good luck. Post after remodel pics when you are done. Best Wishes, Mike
How did you happen to "run across this good deal"? What kind of contract did you structure with the seller? (regular contract with a note, land contract)
@Alisa O. I actually found it on craigslist he. I did a search for owner financing. I bought some land a while back on owner financing and knew it was probably the only way I was going to be able to structure a deal right now. We used a standard deed transfer and note, but I have used a land contract in the past were the seller kept the deed in his name. I presented 3 offers because I didn't really know what the seller wanted. Asking price with nothing down and a low interest rate, a lower price with 2k down and 1 point higher interest, and a much lower price with 2k down and 3 points higher interest rate (that I would have refinanced in a year after showing a track record on the property). He took asking price with little down and a low interest rate.
Originally posted by @Adam Morgan :
@Alisa O. I actually found it on craigslist he. I did a search for owner financing. I bought some land a while back on owner financing and knew it was probably the only way I was going to be able to structure a deal right now. We used a standard deed transfer and note, but I have used a land contract in the past were the seller kept the deed in his name.
Where did you get the forms for the standard deed transfer and note? All my purchases have been with my Realtor in the room and the forms provided by the Title company. How do I go about buying property on my own?
Nice property. From the pictures I am not sure I would do anything, but you are the one in the rooms.
I like your strategy of presenting 3 offers. I read about this before, but never tried it. Well, now you inspired me.
Did you try any other means of finding seller financed deals besides the craigslist?
Mark Forest for the original purchase contract I used a downloaded copy of the Standard Georgia real estate contract. I'm sure each state would have a generally accepted form. This one was approved by the Georgia Realtors Association. I just took a signed copy of our purchase contract to a local real estate attorney that I was recommended to here on Bigger Pockets and he wrote all the required stuff like title search, deed, note.... About a week later we all met at his office and did a standard closing. I think I have bought about 10 houses in the past the regular way with realtors and this was the first closing I have ever been to where the seller was in the same office at the same time. A little different, but nothing in the process was hard or confusing. The attorney was very clear that he would not have done the paperwork for a seller financed note if I was going to occupy the property due to the Dodd Frank/Safe act, but since it was clear I was purchasing as an investor, he had no problem with it.
I think new people should use a letter of intent and not try to draft documents
Just put together a letter spelling out
Name a purchaser name of seller, address of property, legal description of property, and what you both wish to accomplish
You could say:
the undersigned agree to enter into a letter of intent in order to purchase the above mentioned property via
subject to or
agreement for deed or
subject to and a note
If you work closely with a local attorney, I believe it's a lot easier for new people so they going to learn everything about offers.
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