Wauwatosa duplex house hack to rental
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Wauwatosa.
Purchase price: $114,000
Cash invested: $50,000
Sale price: $250,000
Large duplex in a great neighborhood. Built in 1920 has many wood details.
What made you interested in investing in this type of deal?
This was our 1st home and bought as a house hack, before house hacking was a thing. We lived in 1 unit and rented the other which paid for our monthly mortgage.
How did you find this deal and how did you negotiate it?
We were touring the neighborhood, frustrated we couldn't find anything we liked. My wife pointed at the building and said, "why can't we find something like that duplex?" I looked at and said it is for sale by owner. We called on it and they had an accepted offer. We went away sad, but received a call a couple of days later when the the offer fell through. We paid asking but the seller said he liked us because he felt we understood the issues and work need on the property.
How did you finance this deal?
We borrowed $2,000 from our parents and put up the rest fort he down payment. We then used a conventional bank loan with 10% down (this was possible then many loans were 5% down).
How did you add value to the deal?
Over the years we added a new roof, painted the exterior, repaved the driveway, new kitchen and bath updates.
What was the outcome?
This was a long term rental that we owned many years after we moved out of the property.
Lessons learned? Challenges?
We m oved 1.5 hours away and it was difficult to manage issues that came up from a distance and being busy raising a family. I would always try to be close to the properties if I am managing.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
This was all done directly with the owner, but we closed conventionally at a title company