We rehab'd this house last year with the help of our very capable contractor team. This house is one of the newly built single family houses in our city which we were lucky to find through HUD houses for sale. When we bought it, it needed a roof and a lot of cleaning up inside. We cleaned and painted, replaced all the flooring and put in a new furnace. We didn't need to worry about lead paint because the house was built after 1978. The windows were newer and tight, and the house was built with good insulation. The house is located in a turn around neighborhood, and we feel good about our contribution by bringing this house back up to proper condition.

Our strategy, buy and hold. We bought the house for $29K from HUD in poor condition. We did the necessary repairs for another $18K, so we ended up with $47K invested. I closed on a 30 year fixed, 80% of appraised value loan last month for $52K. This was enough to repay all our costs and closing fees. The property is rented to a family that appreciates it and cares for it as their own home. We get a small cash flow every month after our expenses for the mortgage, taxes, management fees, water, and maintenance.

The best part of this story is the appreciation we get from the community for turning this property around, adding value to the neighborhood and providing a good home for one family.