Leave 66k in or sale for 107k
Hello guys
Reno got costly on this last BRRRR deal. I'm a Buy And Hold type of guy but the sale is calling me after running the numbers. FYI: If I keep I will be sidelined for 8-12 months until I can buy another deal. Selling I save 30k on the Reno budget resting in a 107k sale.
What you guys think Keep a fully renovate home for 66k in a C+/B- area or sell for 107k for the next deal?
KEEP
- Cash Flow: $664
- CoC Return: 12%
- Equity: $175k
- Total Left In Deal: 66k
SALE
107k profit
https://www.biggerpockets.com/brrrr-calc/1809608.pdf?c=17117...
Conte,
If your not happy with the current cash flow and want to avoid the 12 month delay sell now and 1031 into 1-2 more REI's. Waiting does not earn money, time is a valuable commodity.
Newbie here,
If the refi numbers don’t bring in your comfortable cash flow, then sell and keep it going. I’m a buy and hold as well but if it doesn’t make dollars…
I also factor if the neighborhood is growing, is anything bringing appreciation. If it’s stable then rinse repeat. Doing my first few repairs on my third door, 🤞🏽 I can stay on budget.
Good Luck!
#2 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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- San Diego, CA
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#2 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- San Diego, CA
What is your ROI on the sale?
Quote from @Jason Wray:
Conte,
If your not happy with the current cash flow and want to avoid the 12 month delay sell now and 1031 into 1-2 more REI's. Waiting does not earn money, time is a valuable commodity.
great response. ROE will be higher than your ROI selling rather than holding. Id move the $ into the next deal or two as jason said
@Conte Cuttino, I am having trouble following you numbers, but if you are making $664/mo in truly free cash flow after all vacancy, capex, maintenance, etc reserves are met, compared to your $107k profit after all commissions and taxes are paid, you are really only making 7.45% on your money.
So do you sell? I would ONLY IF there is something out there that can return more than 7.45%.
But, I am still confused where a refi comes in to play, or doesn't, in your hold scenario. It seems like if you have $175k of equity in the deal to hold, you can refi out a good amount of money, keep asset, and still get another deal.
