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Real Estate Deal Analysis & Advice

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Skyler Wheeler
Pro Member
  • Marion, NC
6
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Finally Closed My First Deal!

Skyler Wheeler
Pro Member
  • Marion, NC
Posted Feb 21 2020, 20:48

Investment Info:

Large multi-family (5+ units) buy & hold investment in Morganton.

Purchase price: $350,000
Cash invested: $52,500

Small 8-unit Complex. Figured I had to start somewhere, so why not start a few steps into the "stack" as Brandon calls it!

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

I felt that multi-family was the best way for me to get started because of the economies of scale. I believe that it is a more "forgiving" asset type and this size is perfect for where I was at financially and comfort wise.

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

I was actually referred to the seller by a guy from my church. I was telling everyone what I was interested in and he introduced me to the seller.

The seller did not have it listed and initially was asking $350,000 for it. He did not want to pay realtor fees. He also had an adjoining lot that he wanted to get rid of. He originally was asking $35,000 for the lot. I offered $345,000 for it as well as $5000 for my broker that I would pay. This allowed me to finance it all less my 15% down.

How did you finance this deal?

I went through a small regional bank. They offered very competitive rates and was willing to lend to me despite not having any other experience. I was able to use a HELOC on my primary residence to pay for the down payment. So I actually got this with $0 of my own money!

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Eric X.
  • Real Estate Agent
  • Naperville, IL
129
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196
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Eric X.
  • Real Estate Agent
  • Naperville, IL
Replied Feb 21 2020, 20:56

@Skyler Wheeler

Congrats on your first deal! Always exciting taking the plunge for the first time.  How is the cashflow on the property?

Good idea taking a heloc.  Technically since it is for an investment, it is tax deductible.  

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Skyler Wheeler
Pro Member
  • Marion, NC
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Skyler Wheeler
Pro Member
  • Marion, NC
Replied Feb 21 2020, 20:59

Cashflow right now is at $1600 after all expenses, repairs, capex, prop management (I'm doing that myself for now) etc.  Cool thing is, they are between $150 and $250 below market so once the current leases run out, should be able to raise that cashflow quite nicely!

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Cory Wallace
Pro Member
  • Rental Property Investor
  • Norfolk, VA
38
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53
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Cory Wallace
Pro Member
  • Rental Property Investor
  • Norfolk, VA
Replied Feb 22 2020, 06:44

@Skyler Wheeler congrats on taking that first step. A lot of people do not do it.

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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
Replied Feb 22 2020, 07:24

@Skyler Wheeler

Did you talk to the bank and setup the loan process prior to making an offer on the property or after?

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Skyler Wheeler
Pro Member
  • Marion, NC
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Skyler Wheeler
Pro Member
  • Marion, NC
Replied Feb 22 2020, 13:20

Thanks @Cory Wallace

@Brandon Chandler I was basically talking to banks while negotiating the deal with the seller.  It was a few day process of course getting down to that price.  Meanwhile I was calling around to banks to see what they offered and the terms.  Once I decided on the lender, I filled out my personal financial statement and got the property officially under contract.

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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
4
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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
Replied Feb 22 2020, 13:31

@skyler wheeler

Makes sense. Thanks and congratulations on your deal! I wish you continued success. 

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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
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Brandon Chandler
  • New to Real Estate
  • Olive Branch, MS
Replied Feb 22 2020, 13:31
Originally posted by @Brandon Chandler:

@Skyler Wheeler

Makes sense. Thanks and congratulations on your deal! I wish you continued success. 

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Michael Magno
  • Real Estate Agent
  • Wadsworth, OH
158
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215
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Michael Magno
  • Real Estate Agent
  • Wadsworth, OH
Replied Feb 22 2020, 15:10

Congrats! 

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Sabrina Sanchez
  • Real Estate Agent
  • Lowell, Ma
117
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118
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Sabrina Sanchez
  • Real Estate Agent
  • Lowell, Ma
Replied Feb 22 2020, 15:14

Congrats! It's always nice to see others making great moves and I love how you found the seller. Sometimes it's a matter of just letting people know what you do so that opportunities like this arise. Now it's time to plan for the next one! Best wishes!

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Kyle Curtin
  • Real Estate Agent
  • Tewksbury, MA
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494
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Kyle Curtin
  • Real Estate Agent
  • Tewksbury, MA
Replied Feb 22 2020, 17:28

Congrats! Heres to many more properties!