Fix and Flip 2 Duplexes

[Brad Stegall]

Investment Info:

Small multi-family (2-4 units) fix & flip investment in Peoria Heights.

Purchase price: $140,000
Cash invested: $8,000
Sale price: $195,000

I bought two empty duplexes right next to each other. They were owned by some guys out of Chicago that hadn't been able to manage them well because they weren't local. I knew they were worth a lot more than $140K if I could get the units filled up. Through networking at a charity event I met someone who wanted to get into real estate investing. They would end up buying the duplexes from me after I got 3 of the 4 units leased out and cashflowing. I had to buy appliances for all 4 units and some other minor repairs.

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

I knew that I could add value by leasing out the units.

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

A friend of mine called me who happened to be friend with the owners from out of town because he knew I was an investor.

How did you finance this deal?

I bought it for cash with lines of credit from other properties that I have good equity positions on.

How did you add value to the deal?

I bought new appliances for all 4 units and got 3 of the 4 units rented out.

What was the outcome?

I got one unit rented out the first month and the second came quick too. the rental income almost covered all of the money that i had to put into it for appliances and repairs. I ended up clearing just shy of $50K.

Lessons learned? Challenges?

The biggest challenge was that we were going into the winter and that isn't a good time to rent places in this area.