Networking and Education

[Ian Robinson]

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Wellsburg.

Purchase price: $75,000
Cash invested: $50,000

I purchased a 4-Unit apartment building last November. Two of the units were occupied at the time of purchase and I gained another tenant a few months later. I have since released this tenant from their lease. One of the four units was previously a commercial space and is zoned as such. I will be converting that space to a 1-bedroom studio apartment over this fall season.

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

I purchased this property after a divorce. I was looking for a home to buy and found the apartment building. Initially, I was going to move into one of the units, but decided to rent it out instead. I purchased a small home as my primary residence with intention of converting it to a rental in the future.

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

I found my property on Zillow. It was listed at $99k, but I was able to negotiate a purchase price of $75k with an appraised value of $89k.

How did you finance this deal?

I used a local bank with a solid lending reputation. I purchased at 6.5% for the first 5 years, adjustable after. I will be re-financing this property prior to any adjustments.

How did you add value to the deal?

The building had an empty commercial space in one unit at the time of purchase. There is no demand for commercial space in my area. I did a complete demo and renovation of that space, converting it to a 1-bedroom efficiency apartment. I had the property re-zoned to residential only, decreasing my tax burden slightly. I now have 4 rentable units at the property.
I hired a contractor to replace one of the roofs. Unfortunately, the new roof leaks worse than the old roof.