Updated over 6 years ago on . Most recent reply
1st Investment Property Purchased as a Single Parent.
Investment Info:
Single-family residence buy & hold investment in Elsmere.
Purchase price: $107,000
Cash invested: $107,000
Purchased as primary residence as a single parent to two kids. Converted to rental property after purchasing new residence. SF 3BR 2&1/2BA, 1 car garage, fenced yard, full basement and a shed.
What made you interested in investing in this type of deal?
I worked for a large commercial real estate company as a property manager. Handling all of the financial reporting to the owners/partners, I was privy to their payouts. One day their accountant came in with their tax docs and financials. She had a summary on the very front page which showed a net worth of $44 million for the majority partner. That was the day that I discovered my path to wealth.
How did you find this deal and how did you negotiate it?
MLS & Real Estate Agent.
How did you finance this deal?
Standard FHA financing. Also received a $5000 grant towards purchase.
How did you add value to the deal?
I've remodeled the kitchen, both full baths and updated the landscaping.
What was the outcome?
The property is rented and cashflowing $300 per month with around $40K in equity.
Lessons learned? Challenges?
Shop around. Don't be afraid to make lowball offers. Find a real estate agent who knows what they're doing and pays attention to detail. Don't sign anything without reading and understanding it first. Don't be afraid to be your own advocate. People will try to bully you into accepting terms you don't have to so don't be afraid to say NO! Don't be afraid to stop a closing to get what you are contractually obligate to receive. You don't close, they don't get paid.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Yes, Mary Kay Radenheimer (agent) in KY and Jodi Wolf (agent) for Indiana and Ohio. No one works harder and smarter than these two ladies! Paul Vickers for personal lending and Springfield Bank or Citadel for investments. We no longer use financing for purchases and rehab. Cash holdings cash flow like crazy and less debt increases your ability to weather a market downturn. Be secure in your investments.