What is the least % return you estimate to receive on a BRRR?
When bidding on a property you wish to BRRR, is there a minimum benchmark you typically strive to achieve?
For a perfect example, if you can estimate the ARV will be 100k and know that you can complete the property for 80k, you're going to be able to estimate pulling out 100% of investment (assuming you can refinance for 80% of ARV).
Of course pulling out 100% or even more would be the top goal, but what the lowest percent benchmark you would accept while considering your business model the BRRR strategy?
So would completing the property for 90k with a 100k ARV still be a healthy number even tho you're still leaving 10k (which is 10% of the up front investment) in the deal (assuming you can refinance for 80% of ARV)?
I would say yes, as long as it's less then 20%, around 15% lets say, then it's still scaleable but wanted to know anyone else's personal preferences here. No, I wouldn't prefer that for every purchase but I'd treat it as the lowest benchmark I'd gravitate towards if the buyer won't negotiate lower.