First investment property in the books!
Investment Info:
Large multi-family (5+ units) buy & hold investment.
Purchase price: $368,000
This is the first investment property that I just closed today! It is a 5 unit apartment complex comprised of 4: 1 bedroom 1 bath and one 2 bedrooms 1.5 bath apartment. I purchased with 3 tenants in place all paying significantly under rental values ($300-500 lower) but after renovations, I plan to increase rent to the market value and will have an estimated cash flow of $1400 a month.
What made you interested in investing in this type of deal?
I was interested in the property because it needs a lot of work, but the cash flow after was too hard to turn down. The location is close to a military base so tenants have a steady job during this crisis which made it even more appealing.
How did you find this deal and how did you negotiate it?
MLS. It was managed by a property management company that took a very hands-off approach and let the work being done be subpar and with the owners not being local they did not have a clue the condition the property was in. I saw the potential and brought up the poor work needing to be done (mainly electrical) and the estimates I received for the work along with a low ball offer out there of $115,000 lower than asking price and they accepted.
How did you finance this deal?
FHA loan, we intend to live in the 2br/1ba apartment.
How did you add value to the deal?
We are currently renovating the apartments which will allow us to increase rent by up to $500 per unit.
What was the outcome?
We just purchased the deal so TBD so stay tuned!!
