Updated over 3 years ago on . Most recent reply
Bought two houses in one package deal.
Investment Info:
Single-family residence buy & hold investment in Culver.
Purchase price: $130,000
Cash invested: $152,000
A Cape cod style house within one block of historic Culver restaurants. This house was built in 1910 as a 3 bedroom, 2.5 bathroom. The floor plan and exterior land usage was functionally obsolete but had the potential to rework it and significantly improve the property. To improve the outside design I had the property survey and then petitioned the city to correct the property line for more efficient use of the space. Added a large deck and privacy fencing to create a back yard oasis, and installed fresh lawn and improved the landscape. On the inside, the kitchen walls were opened up and the chimney was removed to increase the size and floor plan of two bedrooms. The entire house was reworked from the studs up, as we added a proper laundry room, and converted to a 4 bedroom, 3 full bath home. Redesigned the stairs to improve rise and run up to code. Lastly, the entire house is significantly more efficient and green, closed cell foam insulation, all new E windows and all new LED lighting, and an insulated basement.
What made you interested in investing in this type of deal?
I was able to buy two houses that together needed rehab and redesign. There was a lot of function obsolescence in and around the homes. We were able to see how to improve them both and have the Teams get the work to execute with high quality. Our knowledge of the marketplace and the demands of the buyers allowed us to redesign and improve them.
How did you find this deal and how did you negotiate it?
We found the deals using D4D. Then negotiated directly with the owner.
How did you finance this deal?
Cash on my assets and then BRRRR
How did you add value to the deal?
Market knowledge to develop an ARV and a solid estimate of construction costs. It also takes working with the contractor to make changes to improve and mitigate costs.
What was the outcome?
Purchased both houses for 187K spent 165K and they valued at 529K
Lessons learned? Challenges?
As Kiyosaki states hire experts. The challenge was getting the property line adjustment through the city. Once I got the right RE attorney, it all fell into place.