My Ugly Duckling - 818 N University Toledo, Ohio
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Toledo.
Purchase price: $5,500
Cash invested: $22,500
A duplex with 3 beds and 1 bath in both up and down that is situated former neighborhood dumpsite. It is situated on a double lot with off-street parking.
What made you interested in investing in this type of deal?
I had the property listed at a higher price and had shown it at least 20-25 times. Each time people were put off on it because it was a dumpsite for the neighborhood. Every time I came back I saw the potential. I had someone who was interested and planned on writing but decided to "Go On Vacation" and think about it. I told the lady that it might be gone when she got back. I decided to approach my client about me purchasing it. He said yes & I've never regretted the decision!
How did you find this deal and how did you negotiate it?
I have been an REO agent specializing in distressed properties. My client, the seller had negotiated to purchase 4-5 homes from a lender that had been foreclosed as a package that included this property. I listed and sold the other ones after they were renovated in fairly short order. This one was the ugly duckling that was a local dumping spot for tires, mattresses, and construction materials. It needed to be watched regularly because people would drive by and pitch stuff out.
How did you finance this deal?
It was a cash deal. I offered $3000 & paid $2500 in back property taxes.
How did you add value to the deal?
I installed new plumbing throughout the building which included the main water from the street, remodeled both baths. We put in 2 new hot water tanks, 2 new furnaces. Painted both the exterior & interior, new steel doors. Landscaping improvements included cutting down and removing 3-4 trees. Installed exterior security lights, a stockade fence and added a stone driveway for off-street parking.
What was the outcome?
The outcome is a safe habitable duplex with tenants that seem willing to stay and limited capital expenditures for the near term.
Lessons learned? Challenges?
Don't be afraid to fire contractors that are not abiding by what they promised to do also to press forward with looking for the next deal and not hesitate.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I am an agent and would be glad to share my experiences with you.
