3rd property - current residence

[Kristi Kandel]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $355,000
Cash invested: $82,750

I live in the home right now. It was a complete fixer upper and I was able to add a highend master bathroom.

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

I wanted to invest in a specific area knowing the improvements and new construction happening in the next 3-5 years on the private and public sectors that will make home values skyrocket.

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

I mailed a personal letter to every home in this community. A few weeks later Grandma Shirley gave me a call. She was the original owner and had stopped living in the home about 7 years ago. Her long-term renters were moving out and in her words, "It's time to let this one go". She was an incredible sharp older woman but also knew that the house hadn't been maintained for several years. We looked at zillow and I explained why my offer was 45K lower than a comp. She accepted the first offer.

How did you finance this deal?

owner occupied 5% down FHA loan.

How did you add value to the deal?

I remodeled the entire interior, exterior paint and new deck, cleaned up the yard and weatherproofed the shed and added power. I also added a master suite bathroom.

What was the outcome?

I still live in the home but have significant equity. I'll either take a HELOC or refinance to pull cashout to invest into another deal. This house is a long-term hold though due to the significant community changes and improvements coming to this immediate area the next 3-5 years.

Lessons learned? Challenges?

Hand dig around all water meters. The utility districts may not bring a direct lateral into a property meter. In my case they wrapped it around the exterior of the meter and we busted the water main while trying to add a shut off value which led to the necessary replacement of the corroded main line. Shower tile trim is very detailed and takes time to do it right.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Norm at RPM Mortgage. I've bought 3 properties with him.