Fell into buy&hold accidentally

11 Replies

Investment Info:

Single-family residence buy & hold investment in Oklahoma City.

Purchase price: $71,500
Cash invested: $5,000

Purchased 3-bed 2-bath home as a primary residence in 2012, lived in it as a primary residence and rented the back half for several years. Converted to full-time rental early 2018. Estimate $60,000 in appreciation earned since 2012.  Rented for $1,100/month now, cash flow $350/month after pulling out mortgage, capex savings.

What made you interested in investing in this type of deal?

I knew it was a great deal in 2012: our apartment was $400/month, increasing to $500/month after some small improvements. When I purchased the house the mortgage was $550/month and we had a renter living in the back half of the home paying $400/month.

How did you find this deal and how did you negotiate it?

I got in touch with a local realtor after I applied for a job with him! I ended up taking another job, but then asked him to help me find a house. This was a house listed normally on the MLS.

How did you finance this deal?

First time homebuyer program with a zero-down local program tacked onto it. I had to pay for the termite inspection and one other one, got the seller to cover closing costs, so I moved into the house for less than $1000 cash.  We lived in the house for 6 years, then converted it to a full time rental.  Updated a bathroom, painted and improved some flooring.

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Sweeeeeeet! Sounds stellar. Keep up the good work!!! Might be a good time to sell if you want to scale up and go into the multifamily game once the OKC market corrects 💸💪

@Alyssa Dyer

Yes! My (romantic) partner bought a home two years ago that we live in. Then I bought a second rental a few blocks away the next year. And he's buying another house this month that we're still deciding what to do with. I think we should work on it for 2 months, move into it and do a live in flip over 2 years (projects in the area make me think the market is going steadily up in that area in the next year-ish). Then we would refinance current residence to turn it into a rental.

@Nathan Allen

I keep considering it, I don't know that I could get the full $60,000 tomorrow without some more updating: kitchen is old, laminate countertops and a tiny sink because the cabinets are old and small, yard could use some help, needs a few new windows. But I'm keeping my eye on the market! And in the meantime the cash flow is good and I can do upgrades slowly.

@Cassi Justiz

I don't understand why every person in Oklahoma doesn't buy a house!! People our age were skeptical of my decision 7 years ago but now in the present we have (almost) 4 houses and they're buying their first now... I only wish I'd had the ability and knowledge to buy more back then!!

@Bethany Patterson

Great stuff. $71k for a 3/2 has turned out to be a great start, eh!? I agree with @Cassi Justiz on the live-in flip or turning into a rental being a great way to get started. While we started getting rentals while my partner and I were renting, we bought a house which subsequently became a rental. We then bought a live-in flip and plan to do continue with another live-in flip again. Cheers.

Originally posted by @Bethany Patterson:

@Nathan Allen

I keep considering it, I don't know that I could get the full $60,000 tomorrow without some more updating: kitchen is old, laminate countertops and a tiny sink because the cabinets are old and small, yard could use some help, needs a few new windows. But I'm keeping my eye on the market! And in the meantime the cash flow is good and I can do upgrades slowly.

I love the cash flow concept. That's really what it's all about at the end of the day! Honestly you could do a kitchen & windows in a few weeks and be ready to move on with life but to each their own 🤜💥🤛 Rock on!

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