Yes! Good eye! Thank you for the compliment.
Thanks for reaching out. The duplex cost $370,000, 6 Beds/6 Baths, 3,282 Sq. Ft. for both sides combined. For financing, I simply did a conventional commercial business loan through a bank (buying the property through my LLC) putting 20% down. I'm looking to do the same structure for when I buy a quad next. BiggerPockets is a great mentorship program through all their books, videos, podcasts. I'm building "the stack" as Brandon Turner talks about.
That's nice for sharing the strategy, Alex. I just want to understand more about the strategy when you negotiated for the price. What is the ARV when you agreed to pay $370k for it? Did you put any rehab work into it? How much both units can be rented for?
The listed price was actually $390K...$20K difference from the purchase price. I started at $360K, they dropped their price to $385K, and we went back and forth until landing on $380K if they paid all closing costs. We move forward and I get a home inspection that mentions the roof was worn way down for what it should be. I hired a roofing contractor to take a look and he said the whole thing needs to be replaced in 3-4 years due to hail and wind damage and not the best install job either.
After making the seller aware of this they used insurance to replace the whole roof because I said I wouldn't buy it otherwise. $17K later the job was done. The appraisal came back to value the property at $370,000 so I agreed to that paying my own closing costs.
The whole project was turnkey. I've been in California for several months and bought it while out-of-state. Each side rents for $1500/mo.
@Alyssa Dyer Hi interested in knowing how is the Norman area? Thanks
Thanks for sharing so great details. We can learn from each other everyday about deals. Each deal has its own characteristics :)
I'm glad I can help! I agree, we always should learn from each other. That is why I enjoy BiggerPockets so much. I see you're from New York City. If you're looking to buy out-of-state I highly recommend this BiggerPockets published book. There is a lot of great info in there. Thanks for being an active investor!
Thanks for the intro. Coincidentally I have finished that book last week. :) It’s a great book to start with.
@Jai Reddy. I put 10% on a pre-construction duplex outside of Denver. I visited the property and the company managing the deal. My first mistake was sending the money directly to the investment group (Mile High Capital) rather than through an escrow account. The founder (Rick Dryer) of Mile High Capital Group, was sentenced in Denver District Court Friday to 132 years in state prison on charges of securities fraud, theft, and violation of Colorado's organized crime laws. District Court Judge Anne Mansfield also ordered Dryer to pay $3.4 million in restitution. How's he supposed to pay while he spends the rest of his life in prison?
I was offered another deal that felt even shadier after the company was put into receivership. I should have used a real estate attorney to check out the contract.
Regarding turnkey properties, I was heading in that direction just to get something done. A turnkey provider that is involved in Bigger Pockets said if I really want to become an investor, I need to learn the process myself rather than handing over money and let someone else do the work for me. The owners of the company said they will take money if I insist.
My plan is to network with people in OKC to learn the market and make my first deal.
I think turnkey investment properties are a great way for someone to start learning the process with little risk.
I want to take the risk and buy my own property.
I live in Broken Arrow (Tulsa Suburb) and own a lot of rentals.
Did you use the Bigger Pockets rental calculator for your duplex deal?