Live for free with a Single Family House hack
Investment Info:
Single-family residence buy & hold investment.
Purchase price: $160,000
Cash invested: $2,250
Just bought a new primary residence leveraging my VA loan for the second time. It is a 3 bed 2 bath with 1220 square feet. I have just moved in two other roommates making this a single family house hack that cash flows about 100 dollars a month when I manage it myself (Includes 5% vacancy 5% management and 8% capex). I also get to live for free which is a nice addition.
What made you interested in investing in this type of deal?
I wanted to grow my portfolio and gain more experience.
How did you find this deal and how did you negotiate it?
I found it on the MLS 10 seconds after it was posted. My market is very hot right now so i had a LOI ready and sent over in 15 minutes. Other offers came in with an escalation clause but since we had a 5000 earnest money and my agent was taking less of a commission we got the deal.
How did you finance this deal?
VA loan second entitlement.
How did you add value to the deal?
Added value by moving two roommates in before my first mortgage payment was due. I get to pocket almost a full month of rent minus expenses without a mortgage payment.
What was the outcome?
Outcome was that I acquired a turnkey property that will cash flow as a traditional rental as well as by room.
Lessons learned? Challenges?
The seller did not want to make any changes until after the appraisal was complete. This gave him a short timeline to complete all PICRA items and make sure the house was ready to purchase. I would drive past the property on my way home and see that there was nothing done. As we approached closing I thought there was no way he could get it all done. I learned to not stress about something like that and accept that if we needed to delay closing we could.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
My agent was an amazing asset in this transaction and she was able to manage behind the scenes issues that I did not even know about. Every investors dream is for things to go smooth which is exactly what she managed to do. Every aspect of the closing process went according to plan. I used the same loan officer as my first VA loan and it went better then expected. Truly goes to show the power of a great resource team.