Single-family residence buy & hold investment in Raleigh.
Purchase price: $160,000
Cash invested: $9,700
First property! Beat out a $175k cash offer with a letter to the seller. My partner and have both entrepreneurial ventures during our early 20's, and have realized that we have the mutual interest in investing in real estate. Most of my net worth is on paper in the form of equity in my startup, so having some tangible assets that are generating real cash is attractive to me.
What made you interested in investing in this type of deal?
This is going to be a house hack for us. Mortgage + Taxes = only $100 more than my previous rent. The house overlooks beautiful farmland but is still only 10 mins from downtown.
How did you find this deal and how did you negotiate it?
We found the deal on the MLS. While we were viewing the property we counted 7 other investors. We ended up paying list price but heard that we beat out a cash over $15k over list. We did research on the Executor and submitted a well crafted letter that we feel gave us the edge.
How did you finance this deal?
Conventional mortgage, 7% down. Self-employment underwritten.
How did you add value to the deal?
We're house hacking this property, and will be adding value to the deal though the possible addition of a 4th room, new appliances, and interior rehab.
What was the outcome?
We are in rehab now!
Lessons learned? Challenges?
We learned a ton. Having just attended our first BP webinar 55 days ago, we've been drinking from a fire house! I ran into a challenge during underwriting because my W2 is from the company I founded, so we ended up underwriting as self employed and were able to verify my W2 income even though our business returns showed a loss in one tax year.
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