First investment property purchase and lessons learned
Hey guys-
Just got through with purchasing my first investment property in Arizona. Picked up a condo in central phoenix and so far things are going well. Wanted to put up my numbers/lessons learned and see if anyone else has properties near central phoenix. Plan is to hold and use it as a cash flow property. I will definitely sell if it appreciates enough , but not banking on that.
Purchase Price 148,000
Cap Rate (includes hoa vacancy insurance etc etc) 7%
Rent per month - $1220
Closed on it last month and it will be rented to tenants within 2 days. Excited to get things rolling and learned a lot throughout the process.
Lesson 1-
No buying Agent-
My original buying agent turned me onto the condo complex which was great. But later on when we found one come up for sale, he called and said it was a good deal so he was going to place a bid on it. I of course let him go shortly after and continued the process on my own. What i found was that in the hot az market, leaving a buyers realtor out of my purchases seemed to give me a competitive advantage. Prior to this purchase i had bid (sometimes over list ) on many properties with my buying realtor. This time i went direct to the selling realtor and took her recommended buying realtor. I put an offer in with her and it was accepted (slightly under list). I think giving her the option to run the entire deal or recommend her own buying realtor really made the difference in the purchase.
Lesson 2-
I want to avoid dealing with a bank for my next place. It's a major pain and takes away bargaining power IMO. Going to try to put together cash myself for next one or get private loans.
Lesson 3
Using electronic forms (cozy.co) for application/screening etc was well worth it. Made the process really easy. In the future, I plan to get the lease on docusign as well.
Above about sums it up, of course any feedback or thoughts are always welcomed. Tenants move in tomorrow!