Duplex in Lemon Grove - What do we think it will sell for?
Investment Info:
Small multi-family (2-4 units) fix & flip investment.
Purchase price: $645,000
Cash invested: $43,213
Purchased December 2020 for $645,000 with rents in place of $1,500 and $1,945.
Remodeled both units and now rents in place are $2,350 and second unit to be rented at $3,000+.
What made you interested in investing in this type of deal?
I am in multifamily and the 3BR rents have a large delta between 2BR rents, so this was my ideal first investment.
How did you find this deal and how did you negotiate it?
My broker, Terry Moore, had this listed for some time. It fell out of escrow 3 times before we got to it because of one of the units being in complete disrepair. I saw the potential in the property so knew it was priced right for what it was.
How did you finance this deal?
VA loan.
How did you add value to the deal?
Remodeled one unit in it's entirety including kitchen and two bathrooms and landscaping in the back yard. The second unit we replaced the kitchen, one bath was previously remodeled and the other remains in upgraded condition.
What was the outcome?
We will be listing the property in a few weeks and taking the capital to buy four units. Can you guess how much we will make? We will take the hit on the capital gains tax because it will still propel our investment career.
Lessons learned? Challenges?
This was an easy purchase because I had two "exit" strategies. One was hold for cash flow, since the numbers made sense upon entry. The second was sell for a profit, of which it seems the market is in our favor.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I represented myself on the transaction and used my favorite loan broker to get us the best loan pricing.
