Purchased my first buy and hold rental property
Investment Info:
Single-family residence buy & hold investment.
Purchase price: $260,127
Cash invested: $2,500
This is a house in a B+ neighborhood in super desirable area. It is an older property on a big lot, and the location alone gives it a ton of value (great local shops/restaurants/schools etc.). This was a wholesale deal that I got in late 2020.
What made you interested in investing in this type of deal?
Long-term rentals is my game plan.
How did you find this deal and how did you negotiate it?
I was sent this from a local wholesaler. I went to a group showing and had the highest bid.
How did you finance this deal?
Line of credit that is collateralized by other assets.
How did you add value to the deal?
Despite its age, the house was in good shape and it just needed some basic cosmetics. I had a contractor come in and do some basic cosmetic updates.
What was the outcome?
I bought the house about 5 months ago, and I'm currently refinancing it for almost $40k more than what I bought it for.
Lessons learned? Challenges?
I learned that it is possible to get a good deal from wholesalers, but it is very difficult. I also learned that during negotiations with the wholesaler you have to watch out as they will try to bait you into paying more. Minutes before I was told I had the highest bid, the wholesaler asked me if I was willing to go any higher than my original bid...it was obvious that there wasn't another higher bid, but that they were trying to see if I would increase my bid at all if I felt pressured.