New STR-advice is welcomed

[Greg Pawluk]

Investment Info:

Condo buy & hold investment.

Purchase price: $650,000
Cash invested: $130,000

Vacation property. STR. New construction. Considered a condo the way insurance and HOA is structured. Most of the insurance, exterior maintenance, water/sewer, cable/wifi, furniture, smallware, included. OBX is a growing and sought after market. Neighborhood is 1 year old and homes have already increased in value over $100k. Buy/hold strategy. Quasi- creative financing with partnership 20% down and a 60/20 split (traditional mortgage/ heloc). Will refi in future.

What made you interested in investing in this type of deal?

Opportunity. Vacationed here. Kind of fell on my lap. Good situation that I found a way to make a deal. Will use this property for my family as well as make it a business.

How did you find this deal and how did you negotiate it?

Newer community finalizing construction- primarily off listing. Saw a sign being removed. Called the number. Met and spoke with agent, builders spouse. In part of their agreement with township, they were to list a few of the properties on open market. Worked out a deal, found business partners (down payment assistance), and took advantage.

How did you finance this deal?

20% down (through partnership) with a 60/20 split mortgage (60= traditional fixed 20= heloc). Will refi when rates drop in future.

How did you add value to the deal?

The location and the amenities of the community are adding value. You cant find an existing home for sale for same price that doesn't need extensive work and that comes with same assurances, let alone a brand new home, furnished, with amenities such as pool, gym, taco bar, steps to ocean, shops, and the sound.

What was the outcome?

Purchased. Started STR, already securing summer bookings.

Lessons learned? Challenges?

First purchase longer distance. Phone challenges and dealing with less efficient/motivated parties. New business venture with STR.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Shop around with your lenders. They are not all created equal.