Updated 8 months ago on . Most recent reply
Single Family Residence House Hack to Long Term Rental
Investment Info:
Single-family residence buy & hold investment.
Purchase price: $360,000
Cash invested: $75,000
3b2b made into a 4b2b. Remodeled kitchen and lighting plus refurbished floors. New tuff shed garage. Originally was house hacking but now has become a single tenant with their own subleases.
What made you interested in investing in this type of deal?
I was interested in this type of deal because I was living in the area for another year and needed to build equity as well as dip my feet into the real estate market.
How did you find this deal and how did you negotiate it?
My partner and I found this deal through an agent that gave us a list of all the 4b2b properties in the area and we sent direct mail to every household. Luckily 2 got back to us and 1 of them was ready to sell but emotionally was struggling to make the commitment. We took about 14 months to close this deal and the seller was very generous on keeping the price low.
How did you finance this deal?
First time buyer loan with 11% down.
How did you add value to the deal?
We opened the kitchen with a new bar counter space and tore up all the carpet. There is beautiful hard wood floors underneath that we refinished. Added new paint, more lights, and changed an old living room into a fourth bedroom.
What was the outcome?
The property originally appraised at $475k when we purchased, $115k more than we paid, after our hard work the property appraised for $550k and we refinanced to repeat on another property.
Lessons learned? Challenges?
A major lesson learned was the importance of being a genuine human being in your interactions with others. This deal would have never happened if we weren't communicating and caring with the seller. Putting the effort in to find a home available and being patient with the process is crucial for all the obstacles that come through. Trust your plan.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Our RE Agent was Andrew Villalobos and our amazing contractor was Gerardo Reyna. Highly recommend them both if in the Inland Empire of California.