BRRRR: Hard money vs wait to save for a cash purchase?

[Dennis M.]

Hi everyone. I've been lurking here for a while, reading and educating myself, and I'm about 1-2 years away from being able to pull the trigger and get started with real estate. I'm looking to get started by investing in multifamily residential properties, focusing on a BRRR model. Ultimately, I'd like to use my initial acquisitions to move into commercial real estate through a 1031, and continue to build my portfolio in that way. The more I read, the more excited I am to begin. As such, I've been debating whether or not I should look into using hard money to finance my BRRRR projects vs wait another year or so and make an all cash purchase. I understand that using hard money will be more expensive in the short term, but I'm weighing that against the opportunity cost of waiting to make an all cash purchase, and I was hoping you guys would be able to weigh in and and share your thoughts. Thanks in advance for any replies, really great community that's been formed here.

[Joe Villeneuve]

Originally posted by @Dennis M.:

@Joe Villeneuve

Thank you for pointing that out. Well received. My plan would still be to BRRRR the cash projects. Deals that only need minimal rehab seem a little harder to come by in the area I'm looking to start in (Worcester, MA). The Worcester market can be highly variable between blocks, and a lot of the properties that are more or less "rent-ready" with numbers that look good seem to be in more "war zone" type areas, which I'd like to avoid as best I can.

 So, why don't you look in a different market?

A man goes to the Doctor and tells the Doctor, "It hurts when I raise my arm".  The Doctor says, "So don't raise your arm".