My wife and I just closed on our 3rd investment property in Sacramento. Total of 5 doors now in the last 3 years and we both have full time jobs. So anyone else out there can door too!!!
I thought it would be beneficial to share with other members that are looking to do the same.
Purchase Price$389,000 negotiated with seller to $357,000.
The main house is 3bd/1ba 1400sqft in about 13,000sqft lot. The house does need a good amount of work that’s how we were able to negotiate so much off asking price in this competitive market.
The “guest house” which is permitted is about 650sqft 1bd/1ba built in 2008 much newer than the main house and is basically move in ready.
We originally intended to go with 20% down but after we went through home inspections we changed the terms to go with 10% down and decided to use the remaining toward renovation budget (going for open concept so taking down some walls, new HVAC and new kitchen).
Our mortgage along with utilities and other home related expenses is about $2300 monthly.
The guest house will rent for about $1100.
Out of our pocket after guest house is rented is going to be somewhere around $1200!! ($2300-$1100= $1200).
The lesson here is that we were paying $1330 to rent an apartment last month. Even in this competitive market there are ways to make deals work. I’ve been inspired by other posts and hope that this posts benefits someone out there :)
I would be happy to share more details if needed...
Thanks for reading,
Congratulations !! I wish for you to 10X that achievements by this year next time. Keep it up :)
Great find, congrats @Nick Sandoval ! What part of SAC is it in? I've been looking in SAC for investment properties myself, would love to chat and compare notes.
@Nemat Waseem thanks! Yes the plan is to scale up.
Nice work! Thanks for sharing
@Katrina Razavi we looked around quite a bit throughout Sacramento so I became familiar with the different neighborhoods. The property is located in zip 95864, I would classify it as a C+ neighborhood in a really quite street with owner occupied properties, mainly older homes with bigger lots.
One thing to keep in mind with the new planning zone changes going on in Sacramento and this size lot I would definitely build another unit within the next few years. So keep that in mind when you are searching for properties.
I would be happy to exchange ideas with you. Feel free to PM
Great to hear @Nick Sandoval . Congratulations!!
Even I'm looking in the arden-arcade area. Almost closed in on a property in the same zip code and similar in condition to yours but much smaller lot and a lower price point. However, someone else beat our offer surprisingly as the seller did not even counter us. I would love to know how your experience goes with the rehab and rent. Good luck with this and your future REI journey :)
@Nick Sandoval Thanks for sharing this valuable info and congrats on the House Hack! Are there any additional resources regarding new planning zone changes going on in Sacramento. New to RE Investing but currently researching the Sacramento Market. Currently looking for properties where I can possibly build an ADU or add some square footage in a SFH but trying to understand how to look up homes with the right Zoning Code. Appreciate all the help I can get!
Love the encouraging words!
Thanks for sharing and congrats @Nick Sandoval !
@Rubin Kwon Let me start off by saying that I’m not a zoning expert.
However I did read the “2040 General Plan Update - Draft Land Use Map...” which was released in Dec 1 2020” the draft land use map section (pg 9) speaks to a significant change in zoning.
In essence if this gets approved they would do away with single family zoning and allow up to 4 units or a fourplex. There are mixed emotions about this impacting continuity in SFR neighborhoods but it also creates an opportunity depends how you look at it.
I’m sure there will be some restriction associated with lot size, parking space etc. but this could be a good thing for investors looking to maximize cash flows in bigger lots.
If this gets approved, I’m building a duplex in my other rental (fingers crossed)
@Nick Sandoval This is great! Im getting close to making my first house purchase ever. I want it to be somewhere in Sac or close to it. I want a du or triplex. Did you go through the mls or off market, or something else? Also, how do you find out if the lot your looking at is ok for an adu or other version of adding a unit to the lot? Lastly, how long did you do research for before pulling the trigger on your first investment property?
@Brian Sherman shoot me a DM I would be happy to share details on this one and the other rentals.
Can you share about the construction process? Estimated costs? DIY or with a contractor? Nice story, thanks!
This is awesome and encouraging, congrats @Nick Sandoval !
Ive been looking in the Arden as well as Oak Park. Currently living in Midtown but properties are priced ridiculously out here. Been driving for dollars and contacting owners directly, we will see what happens.
Congrats again on the accomplishment! I will be on the lookout for future updates
Awesome job! I'd love to know how you convinced your lender to let you only put 10% down on an non owner occupied investment property. I need to know this secret :)