Texas City, TX · Member since 2014 · 63 posts · 43 votes
Hey guys,
Just wanted to thank everyone that spent time answering all of my questions(some pretty bad ones too) to this point. I just closed on my first deal yesterday.
I know this means that I'm still just starting on this journey, but I feel like it's a pretty big milestone and just wanted to share it with y'all.
Houston, TX · Member since 2018 · 13 posts · 4 votes
8y
Congratulations, Thomas! That's a pretty big deal. Can you share some details as to how you found the property, what was your strategy, what were the numbers, etc?
Houston, TX · Member since 2018 · 13 posts · 4 votes
8y
Congratulations, Thomas! That's a pretty big deal. Can you share some details as to how you found the property, what was your strategy, what were the numbers, etc?
Rental Property Investor · Park City, UT · Member since 2016 · 678 posts · 531 votes
8y
The first is the hardest. Making the mind shift to go from the spectator status to actively getting on the field and participating is a huge obstacle for many. You’ve done it! Congratulations!!!
Texas City, TX · Member since 2014 · 63 posts · 43 votes
8y
Thanks for the kind words.
As for the deal itself, here are the details.
It's a normal, single family home, a 2/1(~1100 sqft), but it has a detatched garage with a add on 1/1(~450 sqft) above it.
I paid 97150 with 20% down. The closing costs were about 1500. My interest rate is 4.625 and I was charged .04 points. 30 year.
For taxes I estimated about 2700, but I expect them to actually be a couple hundred lower. I just like to be a bit on the conservative side.
For repairs, they are very very minimal. The main 2/1 needs next to nothing. It's in fantastic shape. They even threw in all appliances(which are in great shape) and a TV. It even has a small waterfall in the back yard that the previous owner installed. Also has covered parking for two cars, and the garage that the apartment sits on is a 2.5 car garage, off street)
For the garage apartment, it really only needs carpet, paint, and a new AC(window unit.) So I estimated around 3k for everything.
For expenses I just estimated 8% for vacancies, 8% for repairs, 5% for capex, and 8% for management fees(even though I plan on self managing for the foreseeable future.) For insurance I estimated 200/mo, and it came in a little lower at 180 a month.
As far as rent goes, I should, at the absolute worst case, be able to get 1400 between the two. I'm pretty confident that I can get 1600-1700 though.
That puts my ROI @ 1400/mo right at 8%, which I know is a little low, but I also felt even at this ROI that I'd be happy enough to just finally pull the trigger and learn some stuff.
At 1600/mo my ROI is just a little under 15% which I would be extremely happy with.
I'm positive I've made some mistakes along the way, but I think I'm just really happy to finally stop reading and thinking and just do it.
If anyone has any other questions, please don't hesitate to ask.
Texas City, TX · Member since 2014 · 63 posts · 43 votes
8y
Good luck man. I'm not sure how long you've been contemplating jumping in, but now that I've done it, I'm much happier than when I was just contemplating it. And I haven't made a dime yet.
Investor · Saint Paul, MN · Member since 2015 · 98 posts · 64 votes
8y
Thomas Shaw congratulations! The first one is the toughest! Best of luck to you on reaching your goals. BP is an awesome ally to support your growth. Welcome to the community!
Flipper/Rehabber · Highlands County · Member since 2017 · 87 posts · 33 votes
8y
Hi everyone,
My husband and I just started our Investing Business in April 2018. In the next two weeks we are about to close tw deals (2 single family houses) in our area. That was done before I join the Biggerpockets community. One of the house we bought was from another investor in the area and we will begin the flipping process soon. Now that I have seen some of the videos here, I think i did not do so bad, but not sure how everything is going to end up. I will definitely use the calculator before I place an offer in any future deals. I praying that everything goes well, so we can recuperate our investment and a little extra.
Attorney · Houston, TX · Member since 2018 · 34 posts · 50 votes
8y
Excellent. One thing that jumps out at me from your description is it seems like you got a really favorable interest rate. I've seen lots of folks reporting that even with premium credit they're getting upwards of 5%. Did you get a lower rate because you paid points?
Just wanted to thank everyone that spent time answering all of my questions(some pretty bad ones too) to this point. I just closed on my first deal yesterday.
I know this means that I'm still just starting on this journey, but I feel like it's a pretty big milestone and just wanted to share it with y'all.
Congrats!!! And before you get to the second or two hundredth deal you have to get to the first.
I actually didn't pay any points other than the .04 that was the cost of the loan itself. They offered to let me pay for a lower rate, but I was pretty happy with the rate.
I went with BoA. And while it was not a very smooth process at all and I will likely never use them again, I am happy with the rate they offered.