Here it is ladies and gentleman. Iʼm currently waiting to hear back from my realtor as to whether or not I am the new owner of this property. If youʼve been following the blog for awhile, you know that: I already own two properties (my primary home and a rental property). You probably also know that Iʼve been looking to pickup another rental property to add to my portfolio for a few years now. If fact, there are a couple of blog posts to document my failed attempts in the past. You can read about those here here and here.

Iʼm looking to spend no more than $30,000 for this property since I will be paying cash. Fortunately for me, due to the “housing crisis”, there are thousands of properties in the Atlanta area (and in alot of areas around the country) that can be picked up for peanuts compared to what theyʼve sold for in the past. Each day, I comb the real estate listing in my area looking for the perfect investment property to come on the market.

A couple of weeks ago, that perfect property appeared on my computer screen. The property above was listed for $12,900. No, I didnʼt leave off a digit or put the comma in the wrong place. The property was listed for $12,900 and is bank-owned. There were about 12 photos available and they all showed that the house was in pretty good condition. Prior experience has told me that properties at this price and needing little work will be snatched up pretty quickly. I found the property at about 10am and by 12:00pm, I was on my way to look at the property in person. The listing broker could not meet me at the house but he was nice enough to give me the lockbox code so I could go ahead and look at it. After checking it out, I called the realtor and put in an offer.

The House. This little beauty is a 3 bedroom, 1 bath ranch on a crawlspace. It was built in 1950 but has been renovated within the last few years. The sales history for the house from the county public records are:

  • $105,000 in December 2006
  • $63,900 in July 2006
  • $115,900 in February 2006
  • $108,000 in April 2003
  • $82,500 in October 2000
Repairs. The home definitely has good bones. The windows are fairly new. The AC unit appears to be in good condition. The carpet is in good condition but needs to be cleaned. The kitchen and bathroom has nice ceramic tile and the hallway has laminate flooring. There is a nice sturdy deck on the back of the house but it needs to be pressure washed and stained. The roof needs to be replaced but it can actually hold on for maybe a year or so. The interior needs minor repairs to the ceiling and walls and a new coat of paint. I plan to have an inspection completed prior to the final purchase to make sure there are no major issues.

Financials. I said earlier that the house was listed for $12,900. I knew that if I put in an offer of $12,900, I would be quickly outbid. My initial offer was for $15,000 cash with no contentions. A few days after my initial offer, I heard back from the realtor. The home had over 10 bids already and my offer was not among the top. I initially decided to give up on the house and move on to the next one. After doing a little research on the comps and having my uncle (the contractor) check it out, I bumped my offer up to $25,000. I really think the home is worth approximately $60,000 in the current condition. I should hear something on 4/12/2010. You guys wish me luck and Iʼll let you know what happens.


  1. Mrs. Frugal // April 13, 2010 at 12:02 PM  

    Wow! Good luck, sounds like an awesome deal.

  2. Anonymous // April 13, 2010 at 12:13 PM  

    Man, and I thought Arizona prices were painfully low!

    Good luck to you. It sounds as though you're making some good decisions.

    But am I the only one who thinks it's weird that the deflated prices are causing inflated bidding?

  3. Abigail // April 13, 2010 at 12:14 PM  

    Man, and I thought Arizona prices were painfully low!

    Good luck to you. It sounds as though you're making some good decisions.

    But am I the only one who thinks it's weird that the deflated prices are causing inflated bidding?

  4. Yana // April 13, 2010 at 4:42 PM  

    Good luck. Amazing prices in places that aren't Northern California. The lowest price home I've seen here was a fixer-upper for $125,000. Usually if it's under $200,000 here, it is not worth having unless you want to rebuild it. Even with the economy as it is.

  5. Jesse // April 13, 2010 at 6:35 PM  

    Very cool. I bought a rental a little over ayear ago in Florida for about 115$ down from about 200k. It's doing great, but I would love to continue looking and snag something like this. It's too bad Utah economy is still pretty stable, the housing market didn't drop all too much :)

  6. Money Reasons // April 13, 2010 at 7:57 PM  

    Great story, I'm thinking about trying to pick up a little real estate myself!

    Good luck!

  7. Sylvain // April 14, 2010 at 3:34 AM  

    The price changes over the years are quite amazing. It sounds like a great opportunity.

    I was thinking about doing a similar investment, although the prices around here (I'm in France) are nowhere near yours :-)

    Good luck!

  8. Laura // April 14, 2010 at 3:02 PM  

    Great news on the possible property purchase. How many rental properties do you plan to purchase overall. I know your ultimate goal is to self finance your large purchases but what is the long term plan with the rentals?

  9. Single Guy Money // April 14, 2010 at 8:14 PM  

    @Laura: I would love to have 5-10 properties overall and have a nice monthly income.

  10. Brian // April 15, 2010 at 12:51 PM  

    Very nice find. After the initial $25K for purchase, how much do you plan to put into the house? Like the other poster said, Nor Cal properties like that one will go for $399K at least. Anything less and the land is what you are actually buying. Good Luck! and post some pictures...

  11. Cheapskate Sandy // April 16, 2010 at 3:27 PM  

    I just bought my first investment property on the 7th for - wait for it - $19,500. There are deals to be had everywhere for the right person. :)

  12. Single Guy Money // April 16, 2010 at 7:56 PM  

    @Brian: Not including the roof, I plan to put no more than $1k into the interior of the home. With the roof included, I plan to spend less than $5k.

    @Cheapskate Sandy: That's awesome. Where is the property located? How much did you put into it for repairs?

  13. Soft // May 12, 2010 at 8:56 AM  

    Thanks for such a comprehensive post. Count me in as someone who’s turned down life insurance because I have no dependents. Thanks for cluing me in–I’ll definitely rethink that one!