First deal 1900s multifamily

4 Replies

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $93,000
Cash invested: $300

1908 upper lower multifamily. Near downtown where major construction is nearing end. Fingers crossed for appraisal 🤞

@Dennis M. 

When my beautiful fiance and I, purchased this property. We sought preapproval for an FHA loan. As you most likely know loans like this involved a small down payment, 3.5% in our case. Down payment, title fees and closing cost came to a total of around $9000. We also applied for down payment assistance through neighborworks. Grant given by this assistance was $5600. This still left us with $3600. Now I need to mention that one unit was vacant, one occupied. I will get back on this in one sec.

After our offer was accepted and we entered into contract we had a house inspector come in. Nothing major except one thing, the furnace. Now it did work as it should and still does but it's just old I mean old old. Through negotiations the seller agreed to credit us $2000 towards replacing it, plus one year of home warranty insurance value of $800 (this amount is not included in the equation). So we're ar $3600 minus $2000 we used towards closing leaving $1600 left. Then to top is off we were handed tenants months rent plus deposit at time of closing. Rent plus security deposit came to be $1300. By the time everything was said and done. Our bank acct was only minus 300 at the end of that day. This is way I say we entered this investment with only 300 dollars. 

I did have the furnace evaluated and serviced with a professional and it's in perfect working order. Our biggest piece of mind is with our home warranty. They may not completely cover the whole cost but we will cross that bridge when we get to it. 

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