Investment Info:

Single-family residence buy & hold investment.

Purchase price: $260,000
Cash invested: $10,000

I bought a 4 bed/2 bath SFR walking distance to the University of Nevada, Reno, for $260,000 in 2019. I used a 3% down loan (HomeReady) and seller paid closing costs + 75% of the cost of a new roof. Rents total $2875, for a positive monthly cashflow of $1,100 before reserves.

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

I had just graduated from the university next door and I knew the area well. I also knew how to market room rentals to students, since I had just been one. I was tired of renting and had heard about how house-hacking can totally change your financial status and enable financial freedom, so I set out to find a house-hack.

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

I found the house on the MLS. My real estate agent did a good job of finding comps, so we put in an offer for $5k below list price and seller paid closing costs. I offered a quick close, not contingent on selling any other property. During the inspections, it came back that the roof needed to be replaced. I shopped for ~5 quotes and gave the sellers the median quote (12K). They agreed to leave 6K in an escrow holdback account.

How did you finance this deal?

I financed this deal through a 3% down HomeReady conventional loan. I used CIT bank, an online bank with the lowest rates, to fund the loan. They were a nightmare to deal with and jeopardized the deal several times.

How did you add value to the deal?

I replaced the roof (8K total through Lowes, seller paid 6k, I used 0% interest financing to pay for the rest). I also added a door between the backyard and the common area (since the backyard door was in one of the bedrooms). Repainted most of the house from a dingy green, and replaced the floor in two rooms.

What was the outcome?

I'm still holding the property. I lived in it for a year and then bought a property on the Nevada side of South Lake Tahoe. It's rented out to students with long leases. So far, it's been one of the best financial decisions that I've made.