Nightmare Turned Best Case Outcome

[Ben Kowallis]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $395,000
Cash invested: $17,000

This house was in pretty rough shape when I bought it. The fence was leaning all over the place, there was garbage filled 4 ft deep in the air vents, and normal maintenance on almost anything was never done. This house and the one right next to it are the worse ones on the street, and the rest of the houses looked really good. I used YouTube to figure out how to enlarge and build a new shower downstairs. I replaced the flooring, painted all the walls, new water heater, and a few other things.

It was incredibly challenging during the renovations because I was doing all the work myself and things were moving slowly. After a couple hard months of working, I came home to find the neighbor kids had thrown a brick through the window were standing in the kitchen when I came in. These neighbors had been a problem and had a wall of trash piled up the entire height of the fence. Thanks to BiggerPockets, I was able to locate the actual owner of the home these neighbors were living in. One night, the neighbors got drunk and shot a gun off on the front yard. I was able to show the property owner the video of SWAT at the house and he finally kicked them out.
I didn't think I would make it through this house and wanted to give up, but couldn't.

Since then, renovations were completed, I've had amazing tenants who take care of the house, pay rent on time, and get along with everyone in the neighborhood. This house is now the easiest one to own and runs as passively as you can get. I'm so glad to have stuck it out!

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

It was a good neighborhood with only 2 houses that looked to be in rough shape.

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

This was the height of the market when everything was getting bid up and under contract within a couple days. It was sitting on the market for about 2 weeks and I offered $5k less than appraisal value.

How did you finance this deal?

Conventional loan

How did you add value to the deal?

Replaced all the flooring, remodeled the bathroom, fixed the fence, and got the bad neighbors to leave.

What was the outcome?

It now runs great with no issues and great tenants

Lessons learned? Challenges?

Neighbors are important to look at when buying a home. I don't want to be doing extensive work on my own houses anymore. I'd rather spend the money on someone who knows what they're doing and can get it done fast.