Bluffton, SC · Member since 2018 · 63 posts · 205 votes
Well, I am pleased to say that I finally got my first property in Columbus GA renovated and rented. I purchased the property on auction dot com for $25700. Renovations costed $12,000.
I am all in for $37,700.
On December 31st I signed a 12-month lease with my new tenants for $1050 a month. Can you say super excited! Now I am trying to decide whether I should refinance and take the cash out or just keep it going and save up the cash to repeat the process in another year or so. I purchased and renovated using my savings so I don't have a mortgage on the property.
Congrats! I would stick with using your own cash and not refinance. You are able to save a nice chunk of change each year so use this to build your portfolio. As you add more properties you will have more cash flow and can add the next property sooner than the last. You can always add a heloc just in case you find a great deal and haven’t saved up the funds yet. Leverage can get you a better return, but if you keep getting deals like this one you are beating many on returns who have leverage.
Hey congrats on the first completion. Question though, I've purchased 2 thru auction.com as live courthouse auctions but none thru them after it goes back to the bank. How/what was the process for getting the title search and title insurance thru auction.com?
I appreciate your reply, I think it'd help more than just me...
@Karam A Tascoe
Congratulations Karam! I always believed that if you have the opportunity to use "other people's money" (OPM) and the numbers make sense, take it.
With the low interest rate that banks are offering, a refi-cashout could be your way to a second property.
Would you look at a fourplex in your area for me. Just curious about the numbers there.
Great job man!
Congratulations, best of luck going forward. And by refinancing you would be able to do your next deal faster however I would say it depends entirely on your investment strategy and what you feel comfortable with. Good luck.
@Karam A Tascoe
That is why I believe on taking advantage of the market NOW. -Low rates and high values-
If the market crashes you only would be affected if your tenants moves out to a cheaper rent (or you have to lower yours to prevent vacancy) Your savings will help you weather the situation but you would be controlling other properties at the same time (or a multi-family).
When everything go back to normal, ALL your portfolio will appreciate.
@Karam A Tascoe
Congrats on the deal!
Well above 2% very nice.
Being from NY I'm not sure if this is a long distance rental for you, are you using a property management Co. or managing it yourself.
Looking for some long distance tips seeing how the prices in the northeast are outrageously high for first time inversions.
Good luck
Bill.
My husband and I also bought a small SFH from auction.com this past summer and will have a lease starting Feb 1st. We already have a triplex and in partnership on a 4plex so opted to deleverage our portfolio by keeping our cash invested in it. Instead, we are utilizing a line of credit on the property, allowing us to purchase future flips/BRRRRs. If we were at the bottom of the market, I probably would of just done a cash refi, but being the peak of the market, I'm liking having some reserves for whatever the future will throw our way.
That is awesome! Check to see how much the ARV is and maybe refinancing it makes sense. If it does grab another 10 of these haha! Good luck in the future.