Charlottesville Townhome bought at an on-line auction

[Tom Fisher]

Investment Info:

Single-family residence buy & hold investment in Charlottesville.

Purchase price: $105,000
Cash invested: $15,000
Sale price: $165,000

Property is a two-story 1979 townhome close to the center of Charlottesville. After a cash purchase for $105k and upgrades of approximately $20K, we will rent then finance at 75% of $165k ($124K)
Projected cash flow around $350/month after all expenses including management.

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

Property is within our radius and we are focused on SF and duplex properties

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

Deal was acquired on Auction.com

How did you finance this deal?

Cash

How did you add value to the deal?

Mostly cleaning up a foreclosure in good condition. New flooring, paint, fixture updates, windows

What was the outcome?

We will refinance after renting, take out the maximum equity and add it to our investment portfolio

Lessons learned? Challenges?

Learned an interesting part of bidding on an online auction. In the early phase, the bid increment will increase by factors of $5k or more. If you put in your max price then and are high bidder, you are more likely to pay a few thousand more than if you put in your max bid towards the end, when they decrease the bid increment to $1 or $1.5K

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

Not on this deal.

[Aaron Howell]

If you picked that up at $105,000 that may be the deal of the Century in Charlottesville. I'd think you will get way more than a $165,000 ARV in Charlottesville for a detached townhome any day of the week.