Four plex house hack in expensive Los Angeles

[Jonathan Taylor]

Investment Info:

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

Purchase price: $725,000
Cash invested: $20,000

I used the NACA program to purchase a fourplex house hack in North East LA. I literally just closed and will begin a 6 month rehab to bring it up to market rents.

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

It allowed me to get into the market and live for free in a very expensive market

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

I found this on the MLS, I was targeting multiunit properties that were on the market for more than 90 days

How did you finance this deal?

I used the NACA program to finance the closing costs. I got in with no money down and no closing costs. My 20,000 was to buy points off my mortgage since I will be living in it for awhile.

How did you add value to the deal?

I am rehabbing about 65% of the property and since it only has one tenant, I will be getting market rents for the other units.

What was the outcome?

It is still ongoing. I closed yesterday.

Lessons learned? Challenges?

Persistence is the key to this deal, It took 14 months to get this deal done.

[Jonathan Taylor]

@Michael Williams the NACA process was hard, not going to sugar coat that. It is an inefficient system that does not communicate very well with its many branches. That said, I closed on a four plex in LA... so you earn the rewards of the program by following their rules and just doing what they say. The approval process depends on your situation and I can't give an absolute answer since I used the program to its absolute full extent. I heard there phrase 'in my years of experience I haven't seen a file quite like yours.' So if you are buying a bit more out of DTLA or further it would be slightly easier. DM me for more details and I can walk you through exactly what I did.

Oh and we bought in Glassell park. 

@Zach Cummins My plan is to rehab, hold, and self manage. The estimated rehab time is 6 months and once we get it up and running we will just practice efficient management and build our systems out so we can move on to the next property by mid 2020. My wife and I are taking the smaller unit and will live there until we need to expand. My advice is to look for the properties that have been sitting for 90 days or more with no movement as this was a deal I found on the MLS. Im not experienced enough to get pocket deals....yet!