Investor · Saint Paul, MN · Member since 2012 · 19 posts · 18 votes
10y
July, 2011 - I had moved back home with my dad while I finished a graduate degree and was employed at the same job I still hold today.
I had been maxing out my 401k at work and eventually realized that I didn't want to wait until my 60's to retire, so I began looking for real estate. Also, my dad was becoming anxious about his son being nearly 25 years old and still living at home, so he was going to begin charging me rent. I am cheap/frugal, and so figured that I could live rent free if I purchased a multifamily property and occupied one of the units.
I really didn't know what I was doing. On my birthday, I noticed a 4plex listing near Hamline University (just off Snelling Ave). My grandpa had told me that there was nothing good north of I-94 (implying higher crime). The building was a foreclosure and unoccupied. After walking through all the rooms, I kind of just stood around. The real estate agent asked, "So... do you want to put in an offer."
I offered $181,000 and the bank countered with $169,900 :) - The listing agent didn't believe that I should need to compete with the investors who were "clamoring" over the property. The bank really wanted an owner-occupant.
I listed the 3 non-occupied units at $720 / month and provided free WIFI and laundry. I have since removed the WIFI and have the following rent roll:
I did convert the flat roof to a pitched 5/12 (expensive!), repaired the stucco exterior, and put a bit of money into most of the units, but this purchase has been the best financial decision I've ever made.
I did a cash-out refinance, and could probably do it again within the next few years if real estate doesn't collapse. :)
I used to live in NE and had rentals there as well. This is a very strong area and if you can come across rentals in that area, it would be worth your while to take a serious look.
Property Manager · Minneapolis, MN · Member since 2014 · 380 posts · 167 votes
10y
David,
NE is one of my favorite markets. We bought a 12 unit building and raised rents on a 1 bedroom from $550.00 to $950.00 (2 beds are $1035.00 currently from $650.00 original..) with a 5k renovation per unit/common areas (resident pays heat). This was over 35% ROI in less than a year and still going! One of my favorite buildings we put together.
Highly recommend grabbing anything in the area that is reasonable.
Investor · Saint Paul, MN · Member since 2012 · 19 posts · 18 votes
10y
July, 2011 - I had moved back home with my dad while I finished a graduate degree and was employed at the same job I still hold today.
I had been maxing out my 401k at work and eventually realized that I didn't want to wait until my 60's to retire, so I began looking for real estate. Also, my dad was becoming anxious about his son being nearly 25 years old and still living at home, so he was going to begin charging me rent. I am cheap/frugal, and so figured that I could live rent free if I purchased a multifamily property and occupied one of the units.
I really didn't know what I was doing. On my birthday, I noticed a 4plex listing near Hamline University (just off Snelling Ave). My grandpa had told me that there was nothing good north of I-94 (implying higher crime). The building was a foreclosure and unoccupied. After walking through all the rooms, I kind of just stood around. The real estate agent asked, "So... do you want to put in an offer."
I offered $181,000 and the bank countered with $169,900 :) - The listing agent didn't believe that I should need to compete with the investors who were "clamoring" over the property. The bank really wanted an owner-occupant.
I listed the 3 non-occupied units at $720 / month and provided free WIFI and laundry. I have since removed the WIFI and have the following rent roll:
I did convert the flat roof to a pitched 5/12 (expensive!), repaired the stucco exterior, and put a bit of money into most of the units, but this purchase has been the best financial decision I've ever made.
I did a cash-out refinance, and could probably do it again within the next few years if real estate doesn't collapse. :)