1st Rental Property (learning curve)
Investment Info:
Single-family residence buy & hold investment in Midland City.
Purchase price: $430,000
Cash invested: $96,000
1666sqft 3bd 2.5ba. 2007 build in downtown Bremerton.
What made you interested in investing in this type of deal?
Bremerton, WA is a HUGE rental market and is a growing community near Seattle. I was interested not only in the cash flow monthly, but the appreciation of nearly 15% yearly.
How did you find this deal and how did you negotiate it?
I was selling new construction in the area. I sold a home to a couple who also needed me to sell their home. After a week on the market, I kept thinking, "I should just buy this place and rent it out." So after I saw that it penciled out even using a property manager, I bought it.
How did you finance this deal?
20% down conv
How did you add value to the deal?
I didn't. After I was pretty much locked into the purchase, I started reading up on the BRRRR Method. My downpayment is locked into this property until I sell it. I won't be making that mistake again. VELOCITY OF MONEY baby. Next time, I will find a property I can add value to, pull my money out after a refi, and use the same $$ on my next investment. Rinse and repeat...
What was the outcome?
The positive is that I own a nicely performing rental. The negative is that I need to now save up again. This time, for rennovations, not a downpayment.
Lessons learned? Challenges?
BRRRR. Don't anchor your $$ down. Use the same $$ over and over again, building the portfolio; therefore, building wealth.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I would love to assist anyone needing a real estate agent in WA. I've been an Agent for 6 years.
Tom Clifford with New American MTG was excellent to work with. I would highly reccommend him.