Updated almost 6 years ago on .
Closed On 1950s College Hill Cincinnati 3bed/2bath duplex
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Cincinnati.
Purchase price: $99,910
Cash invested: $56,000
A fixer upper 1,666 square feet duplex: 2bed/1bath and a 1bed/1bath built in 1950s. Needs $27k of renovation work: electrical, plumbing, painting interiors & cabinets, fix external rails, add roof cap. It's on a quiet dead end street in a B/C+ neighborhood.
What made you interested in investing in this type of deal?
I really like multifamily properties of 2 to 4 units for higher cash flow. Cap rate is 7- 8% a year depending on how much this rents for.
How did you find this deal and how did you negotiate it?
Realtor found this property on MLS on my first day visiting Cincinnati in-person. We toured this property out of over 10+ properties and made 2 offers on my Ohio trip. I lowered the price by $6k by agreeing to pay both buyer & seller's realtor fees. It was on market for over 150+ days since Nov 2019 so the price was reduced from its original $115k.
How did you finance this deal?
I placed a conventional 20% downpayment for a 15-year mortgage at 4.5% interest and I decided to pay an additional $200 per month towards principal in mortgage so mortgage total is $1,000/month in order to pay off the 15-year mortgage faster.
How did you add value to the deal?
This is a moderate sized rehab project that needs repairs to make it safe to live and cosmetic updating in all the rooms.
Lessons learned? Challenges?
Closing date was delayed by a month due not having adequate insurance, waiting on title company, and waiting on cash refi to complete on my rental property #1. I wouldn't do a cash refi on another property at same time as getting a mortgage because both banks would be waiting for the other one to complete the closing process in order to calculate LTV accurately.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I worked w/ a realtor from Plum Tree Realty and the title company is Aspen Land Title Agency in Beavercreek, OH. Lenders & underwriters work at Wells Fargo.
