Rental Property Investor · Charlotte NC / Fort Mill, SC · Member since 2016 · 15 posts · 7 votes
I've been going back and forth on it if makes sense to get started with BRRRR investing with an all cash offer or to leverage financing. I am diversifying out of my company stock and will have $200K to invest within the next 1-3 months. The way I look at is I can purchase 1 unit all cash or put down 20-25% on 4-5 units with the cash I will have ready.
Is there one strategy better than the other? What would you do?
Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes
4y
@Mike Amann, I don't think there is one right answer to this.
In my case I have been doing BRRRR with my own cash to purchase and to rehab. However, I have a fulltime w2 job, so doing multiple projects at once would be very difficult. In addition, property where I am has been cheap (until recently). So, I wasn't tying up a crazy amount of money.
Also, working with my own money allowed me to be more flexible with time because my carrying costs were low. Rehabs don't go like clockwork so having some flexibility is important whether it be time, scope of the project, or money. In my case I chose time to be the most flexible factor.
If you are in a more expensive market, will be working these deals full-time, have experience managing rehabs, etc then you very well may wish to use financing and maximize the use of your available money.