- Joined
- Mar 12, 2008
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- 736
We are delivering more than we promised to our Investors. Read the story below to see how we delivered a 32% Return.
Last month we exited out of one of our buy and hold properties and gave our partners a big surprise! A surprise investors like to see.
In the summer of 2009 a key Realtor who we have on our team saw a listing appear on the MLS and told me (Gary) to meet him at the property that same afternoon.
The Property was a Semi in Newmarket which needed some TLC. It had two units and was listed as a Power of Sale.
Listed Price: $204,900
We put our offer in and within 36 hours of the home being on the market we had it under contract for a price well below fair market value.
Our Price $189,900
Within two months of owning the property we renovated the main suite with a budget of $16,000. New floors, new bathroom, new paint and some exterior maintenance. We had the property completely rented out for a total of $2,100 a month. The basement tenant was already in place when we purchased the home. We had positive cash flow of approx. $400 a month. At 16 months the basement tenant moved out and we invested another $15,000 into the property which included new floors, new paint in the basement suite and exterior foundation water proofing.
Now on to the GOOD stuff.
Over the last 20 months the local market was very HOT. Our property to date had cost us $222,000 if we round up. Exact properties in the area were being sold in the spring of 2011 for $300,000.
Naturally, we listed the property and within 8 days we had THREE offers two of which were over $300,000.
We accepted an offer at $306,000. Cha ching!
Let`s run through the numbers for our Joint Venture Partners:
Initial Investment from Investors $56,000 (this included the first renovations, down payment and closing costs)
- Selling Price $306,000
- Subtract Total Selling Costs $16,000 (Realtor fees, Legal)
Subtract Total Mortgage $147,000
Subtract Initial Investment $56,000 and $15,000 additional renovation costs
Total Cash Profit $72,000 !
Our Joint Venture Partnerships are structured with a 50/50 ownership.
We paid out $36,000 to our Investors! For a return of 32% per year. Remember this was only a two year investment.
We managed this property 100% and did not ask our partners to lift a single hammer or broom. We dealt with all the renovations, the tenants and the location research. We have built strong relationships with different Realtors who deliver great investment opportunities. We have also partnered with Industry leading Mortgage Brokers, Property Inspectors and Lawyers. Our Team is Solid.
Our Executive team of Pam and Richard, Michelle and myself have over 60 years of Property Investment experience. We have won awards from the Real Estate Investment Network for being the Top Players of the Year. We are very blessed to be working as a family and look forward to the many years of real estate investing to come.
Thanks,
Pam and Richard, Michelle and Gary
