So we bought a house...

...that's not for us.

Yep, we finally did it. We took the plunge and bought our first rental house!

J and I have been talking for a while about getting into rental properties. We both think having an additional income source in the future is a good idea. Sure we both have retirement accounts, but additional security never hurts.

The driving factor was that we had some extra money just sitting in savings. Neither J or I are big on playing the stock market or dealing with those decisions directly, so we wanted a different approach to investing.

Helloooooooooo real estate investing.

We decided on single family rental properties. The market in Houston is currently awesome for investors. Home prices are low and renting is up. Thankfully neither of us are very impulsive, so we discussed our course of action a good bit. J also read Building Wealth One House at a Time: Making it Big on Little Deals. 

We both got excited.

The hunt for a house began. We drove a lot of neighborhoods and scoured HAR.com. Most potential houses were either more money than we wanted to spend or great price but horrific condition. J and I both work 40 hours a week so while we were willing to do work and repairs on our investment, there was a limit to how much. Full renovations were definitely out.


Then one day J sent me an email linking to this house on HAR:

It was a foreclosure listed at 90k. Right in our price range. Plus, it looked great! Yep, could definitely tell it needed some work but nothing insane.

I called the listing realtor and booked a showing for that afternoon. When we got the house it looked to be everything we wanted. Great price and good condition. There were a lot (and I mean A LOT) of cosmetic issues, but those are easily fixable and just require some elbow grease.

This property was currently held by HUD. The realtor explained that the purchasing process was done by placing a bid on the home. Every night at midnight an automated process ran in which HUD would determine if your bid won the home.

We were very lucky in that previous accepted bids on this home had fallen through (I'm guessing the bidders finances didn't go through). On HUD homes investors can not make bids until after an initial period where the home is available to owner occupants only. Thankfully, that period had passed.

We put in a bid of 85k that same night and the next morning we found out we had won the house!

Next step: lining up financing. Oi!