First Rental Property!

Investment Info:

Townhouse buy & hold investment.

Purchase price: $135,000
Cash invested: $5,000

We purchased our Belmont Trace townhome in 2020 for $135,000 at a 2.75% interest rate and called it home for two years, renovating it little by little along the way. Once we moved, we turned it into our first long-term rental. Today, it brings in $1,440/month - more than double the mortgage payment. Our first rental is officially in the books, and it’s a solid one: low purchase price, great rate, built-in equity, and consistent monthly cash flow.

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

During college, we were ready to leave our cheap, unsafe student housing and saw an opportunity to buy in a better neighborhood while still staying close to campus. With a low interest rate and strong rental demand, a long-term rental felt like the safest first investment especially for young first time investors like ourselves. We could keep rent reasonable while still earning more than double our mortgage so it was a no brainer.

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

I found it on Zillow. During the time it was a sellers market but this location was not quite booming like it is now so we were not competing with multiple offers. What most buyers saw as outdated, is what we saw as potential to increase the value. We came in simply at asking price, as is transaction, standard terms and conditions.

How did you finance this deal?

Conventional loa, 20k gift for down payment, 2.75% interest rate.

How did you add value to the deal?

We did all the renovations ourselves. Interior Reno : painted everything including kitchen cabinets, replaced carpet with LVP, new light fixtures, and epoxied countertops. Exterior Reno : landscaping, painted trim and doors, replaced roof in 2023 due to insurnace.

What was the outcome?

With only about $5,000 in renovations, we helped increase the home’s value from our $135K purchase price to over $200K—roughly $65K in appreciation. Even better, we now have long-term renters who love the property and plan to stay, giving us both equity and consistent cash flow.

Lessons learned? Challenges?

Our biggest lesson was learning that tenants who speak up are often great tenants. They actually care about the home and catch small issues before they become expensive ones. We also learned that location matters, and perhaps most importantly: buy the ugly house with good bones in a great location. That’s a lesson I’ve carried with me throughout my real estate career as it has dramatically helped us.

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

Yes, we worked with JJ Whetsel to purchase this one. At the time I discovered my passion for real estate and had just started studying to become a licensed Realtor. He was amazing and I’ll forever be grateful for him for taking me along through our transaction.