First house hack / BRRRRish type investment
Single-family residence buy & hold investment.
Purchase price: $223,000
Cash invested: $20,000
Bought 3 bed/2.5 bath for $223k with $20k down, put $12k into cosmetic upgrades and added a lot of sweat equity.
Just refinanced to get rid of mortgage insurance; appriased for $355k!
It has been a live-in-flip mixed with house hack style investment. Rent out both extra bedrooms so I only pay $500 per month including capX and maintenance.
Bathroom was an insurance issue so that helped because I was able to upgrade with nothing out of pocket, just a lot more sweat equity.
What made you interested in investing in this type of deal?
Good neighborhood, priced well below market, only needed cosmetic work. Could rent out other rooms to limit my monthly housing costs.
How did you find this deal and how did you negotiate it?
MLS offered a little over asking because there was another offer
How did you finance this deal?
FHA, refinanced to conventional
How did you add value to the deal?
upgraded the entire downstairs flooring (on sale at Costco - materials and labor for 900 sq/ft for $2,500)
new cabinets, countertop, and backsplash for $8,000
master bathroom was $5,000 upgrade for nothing out of pocket (thanks to a water leak)
other upgrades around the place including landscaping and painting for about $1,000
other minor upgrades around the home for
What was the outcome?
Appraised for $355k and I was able to pull all my money out during refinance and keep monthly payments the same since I no longer had to pay mortgage insurance
Lessons learned? Challenges?
Get your hands dirty on the first few deals to save money but also to learn.
Call around, hunt for deals, and you don't know the answer to anything until you ask. "No" is not a scary thing to hear, but "you should have..." is.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Kaitlyn Marty at Windermere Abode in Tacoma has been amazing. My sister is also an agent in Yakima and her insights are valuable (Chelsea Mack).