Just Purchased My First Multi-Family Properties (Pictures)

63 Replies

We just closed this past week on two duplexes in Eustis, FL. These are our first multi-family properties, so we're pretty excited. We bought them from Fannie Mae through HomePath, which a great story in itself. 

They were originally listed for around $120,000 each about a year ago. The funny thing was, the listing prices were $10,000 apart and they were listed with different listing agents, even though the properties are identical and share a common area. Fannie Mae slowly lowered the price every month or so until they were both in the $70,000 - $80,000 range. I made offers a couple months ago, and I made it clear to the listing agents that I wanted both, not one or the other. After over a month of negotiations, Fannie Mae accepted my offers on both, which I think were around $63,000 at the time. When I tried to submit the signed contracts and paperwork, the listing agents told me that both properties had been taken off the market. I figured I'd lost them to another buyer. About a week later, I received a call from a different agent in Orlando, who told me he was the new listing agent for both properties, and Fannie Mae had set the new listing price for each property at $54,000. I jumped on the deal and still can't believe how Fannie Mae does business, although I am grateful for their stupidity.

Anyways, the units of each duplex are 2 bedroom, 1 bath. Great layouts and the bedrooms are huge! Both properties need a complete rehab. Once complete, each unit should rent for about $700 per month.

If anyone has any suggestions on how to tenant-proof rental properties please let me know. I want to include the suggestions in the rehab so these properties are as durable as possible.

Congrats @Matthew B.  ! Please keep updating this thread as to your process with Fannie Mae as well as the rehab. I plan on getting into multi-family rentals within the next year so your story will certainly be a case study for me.

I'm so excited to watch your journey!

Deb

Great story and great buy! Congrats on your first Multi-family!

Way to go Matthew!  Working on our way to get us to that point as well.   Great stuff and encouragement for all of us! JC

Congrats.  You can't fix stupid but you can profit it from it. 

If you have a slab foundation,  ceramiic will be a good choice. Floating laminate flooring in some areas if you choose.  Place some throw rugs in it to stage if you like..... Semi gloss paint is more durable or satin...if you choose to wash on turnovers.  Flat is cheaper otherwise....  Plastic tub surrounds are cheaper.  If you have a cheap tile person, that is much nicer....Good fixtures that are serviceable are worth it...no plastic ones....Easily replaceable furnace filters left onhand for them to change.  Have fun!

Originally posted by @Matthew B. :

We just closed this past week on two duplexes in Eustis, FL. These are our first multi-family properties, so we're pretty excited. We bought them from Fannie Mae through HomePath, which a great story in itself. 

They were originally listed for around $120,000 each about a year ago. The funny thing was, the listing prices were $10,000 apart and they were listed with different listing agents, even though the properties are identical and share a common area. Fannie Mae slowly lowered the price every month or so until they were both in the $70,000 - $80,000 range. I made offers a couple months ago, and I made it clear to the listing agents that I wanted both, not one or the other. After over a month of negotiations, Fannie Mae accepted my offers on both, which I think were around $63,000 at the time. When I tried to submit the signed contracts and paperwork, the listing agents told me that both properties had been taken off the market. I figured I'd lost them to another buyer. About a week later, I received a call from a different agent in Orlando, who told me he was the new listing agent for both properties, and Fannie Mae had set the new listing price for each property at $54,000. I jumped on the deal and still can't believe how Fannie Mae does business, although I am grateful for their stupidity.

Anyways, the units of each duplex are 2 bedroom, 1 bath. Great layouts and the bedrooms are huge! Both properties need a complete rehab. Once complete, each unit should rent for about $700 per month.

If anyone has any suggestions on how to tenant-proof rental properties please let me know. I want to include the suggestions in the rehab so these properties are as durable as possible.

Way to go Matt. Can't wait to see the after photos.

Kudos,

Mary

Good job and great deal! Those should be fantastic cashflow properties for you. How "tenant-proof" you go may partially depend on how that $700 price fits into your market. If it's lower end, by all means go for as much durability as possible. If you're aiming mid-level or higher, it may be worth sacrificing some of that for more eye-appeal (such as using tile instead of tub surrounds, or refinishing floors if you happen to have wood under those carpets). Just enough to be competitive with the tenants' other rental options, really

good to say someone take advantage of the system not the other way around

@Matthew B.  

Congratulations!  You got a fantastic deal!  

Did you have an agent monitoring the properties for you, or were you doing that yourself?

Keep us updated on the progress, we'd love to see the properties once they're all finished!

@Matthew B.  Great insights Matt.  I have been watching our market here in Tallahassee and I am starting to realize that multi-family may be a better deal for this market.  Thanks for sharing!  I hope to learn from your story. 

Sheldon

@Sheldon B.  

Multi-family properties are very hard to find around here. And when you do find them, they tend to be expensive. I definitely got lucky with these. I know plenty of other investors in my area would have paid much more for them.

This is awesome @Matthew B.  , congrats! 

Hopefully you will be in a position to document and share the process of doing the rehab work and listing for others in this forum to use as a case study. 

Good luck! If you need help finding renters we have a large renter pool in FL.

@Payam Dastmalchi  

I'm definitely gonna try to document everything. I've been working on another project this week so I haven't turned my attention to this property yet except to file the tree removal permits. That will be the first work done.

just fully rehabbed a unit like this in tampa.  do yourself a favor and put tile throughout now.  Otherwise you will be replacing dirty carpets and scratched laminate every 3-5 years.   granite is also cheap down here and I use ready to assemble real wood kitchen cabinets.  I place a high value on durability.  even if you don't get higher rents for the additional spend on granite and real wood cabinets, you will have fewer problems and units that will look nice for years to come.   your roofs look good from the pics so that is a plus.  roofs are cheap down here.  what do they have for AC units?  that is what can get pricey is if you have to replace 2 AC units.   

Let me know if you need a reference for a tile guy.  I have a GREAT one who I love.  not sure if he would travel all that way out there though but he does great work, great prices and works fast.

Way to go man, good job......thats what I like to hear. Hopefully you will get two more after you get these fixed up and rented.

Looks great man!

Keep us posted with the "after" pictures!

@David DuCille  Tile is the plan!

The roofs are actually in horrible condition. I was over there yesterday when it was down-pouring, and there were more leaks than I could count! Roof replacement will be the next thing on the list, as soon as my roof guy is free.

There are 4 A/C units, and surprisingly, they are still there after sitting for over a year in a lower end neighborhood. I used to base my neighborhood grades on how fast an A/C would get stolen, but I may have to rethink that... I still don't know if the units are in working condition. I know one was crushed by a falling tree limb.

@Jimmy Moncrief  Will do! I'm planning on keeping this post updated throughout the process.

The tree guy is almost finished with the trees. He got delayed this week with the bad weather. The roofs will be started as soon as the trees are done. I started some of the interior demo this week. I'm still trying to find someone to help, which I talk about in this post.

@Matthew B.  I know the exact properties, I had my eye on them as well. The timing was not right for me but I am glad it was for you. I am interested in following the rehab, and I am definitely interested the rental environment there. 

UPDATE:

Both buildings have been re-roofed! We've also gutted all of the units, which filled the 30yd dumpster to the brim. We had 6 trees removed as well, and the remaining trees were trimmed. 

Cost to re-roof both buildings was $10,500.00. I ended up paying a guy in the neighborhood $200 per unit to do the demo. Tree removal was around $2,500.00 including the stumps.

Next, we are having the soffit and facia replaced. Quote we received is $1,656.00. Then some grading and concrete work, which I plan to do myself. I'm also getting a quote from our plumber to repipe both buildings with PVC while we have everything torn apart.

Let me know what you guys think!

looking good!/ keep it up.  What year were these built?/ looks like early 80s. Not sure they would need a repipe. 

@David DuCille  

You are correct. They were built in 1980. I'm not sure that we're going to get them repiped. I just asked the plumber for a quote since we have everything opened up. It's easier and cheaper to do now than down the road.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here