2017 Ninety Day Challenge and Success Story
Hello BP,
My wife and I recently (December 15th) completed the purchase of our 3rd rental property (4th door) in Augusta, GA. We did not consider it a success story until it was rented out. The tenants will begin their lease Feb. 14th.
We purchased a duplex in March of 2017 and knew we were getting ready to purchase another property. We had been inconsistently following leads, tracking zillow and FSBO's, whenever we had the time. Then I heard Brandon Turner's podcast in October about the 90 day challenge. He challenged us to do something every single day for like 15 minutes to move closer to the next purchase. I ignored the suggestion for a week or so but then listened to the podcast again. At that time, I set up automatic emails for homes listed in our "farm" of Augusta. A week or two later my wife and I were walking into Hobby Lobby to find towel hooks for our master bath which we were redoing. As we were walking in, my phone blows up with an email. It was a Zillow listing of a home in our area listed for at least 10% below market. I had been showing my wife prospective rentals for about a week. Upon seeing this home, while in the Hobby Lobby parking lot, she said "sure you can buy this one." I laughed, thinking she was just blowing smoke so that she could get to more important things, like towel racks.
After further discussion and running the numbers, we realized it actually made sense and spoke to our realtor. She put in our offer without us having seen the house in person. That is because we now live 2 hours away from our target rental area. Our offer went in over the weekend and Monday AM we had a counter offer. At the time we accepted the counter-offer, the other agent let us know that there had been multiple showings scheduled for that day but the seller wanted to sell quickly rather than for top dollar.
At the home inspection, there was a slight odor to this older home, but the roof, HVAC and water heater had all been replaced in the last 3 years. We decided to go ahead with the agreed price.
After listing the property, which looks great in pictures, we realized it was a very slow time for renting a house. We had 5 showings and no one was interested. This was likely because we did nothing about the stale house/slight smoke odor. We then discussed this with our PM and she offered to put a couple of air fresheners in the home. We also lowered the rent $50 to recreate interest after it did not get rented in the first 5 weeks.The next 2 showings both had positive reviews and we now have a renter. We likely could have avoided a month of vacancy and holding cost if we installed air fresheners immediately. Now we know. We believe we are below market rent currently but we still should make 10%+ cash on cash return after PITI and saving for future vacancy and maintenance/cap ex.
On to the next property search.
Written by Winn Merwin
Edited for grammar and content by Kaitlin Merwin