Updated almost 4 years ago on . Most recent reply
First Partnership: Duplex in Mid City
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $145,000
Cash invested: $30,000
This was a duplex that I partnered on. We renovated the bottom unit and once the top unit is vacant, we will renovate that one too. :)
What made you interested in investing in this type of deal?
This was my first partnership, and the purchase price was too good to pass up. The house was next door to one my client's owned so it just seemed like a perfect fit.
How did you find this deal and how did you negotiate it?
My client's passed on it. I made sure they didn't want it and then I negotiated it for myself. It was a bit risky because the moratorium was (and still is) in affect and although we negotiated for tenant free, we ended up getting it delivered with one tenant and one unit free for a little bit less.
How did you finance this deal?
Hard money loan.
How did you add value to the deal?
We renovated the bottom unit and re-rented it out for market rate.
What was the outcome?
Overall it worked out pretty well. We still need to renovate the top unit. That will add more value eventually.
Lessons learned? Challenges?
Be careful which tenants you inherit. We wanted it delivered tenant free, but the top unit ended up staying. They have been hit or miss on paying rent. Luckily the downstairs tenant is reliable and covers the costs. Once the moratorium ends, we will renovate the top and catch that one back up to market rate. :)
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Me! I'm an agent and I represented myself and my partner :)
