Is this a good BRRRR deal? Time sensitive help w specific deal thanks!

Portland, Oregon
General Real Estate Investing
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Is this a good BRRRR deal? Time sensitive help w specific deal thanks!

Robin A Jackson
Rental Property Investor · Portland, OR · Member since 2017 · 29 posts · 7 votes

Hi friends! 

I need some help from other savvy minded people on a specific deal I am considering. I'd be so grateful as I keep going back and forth on this. This is time sensitive. 

If you are an experienced investor and have a great mind for this, I'm wondering if you'd be willing to have a 20 min zoom call with me.  I'd be so grateful for your time and happy to return the fav in some way (I am a high networking machine). If so, please message me. thanks! This is how I made the good decision on my first two BRRRRS. I wrote a message like this and got help : ) 

For everyone else who wants to comment, I'm going to break down the whole deal here, and I imagine this will be a good teaching for others as well! So thanks to those who take the time to reply.

Me: Casual very part time RE investor (I own 4 properties and 7 units between them). I have done major BRRRRs twice (huge remodels on garages and basements) using hard money and tons of risk so I'm not afraid of it. I also own/run a business doing songwriting and music, so my time is split (and I have a new baby!) 

Goal: I want to get another deal under my belt for more cashflow and long term wealth building. So buy and hold (BRRRR).

The House
It's been hard to find many things that pencil for this in my area and houses are $$$ in Portland (avg 500k). I found one that is close. It's located in a good area (near college) and is a 2500 SF 6 bedroom house, with a fully remodeled basement with a separate entrance. The house is in turnkey shape, with tons of new updates. It's vacant (major pro). 

Minimum approach: Put a kitchen in the basement and do some minor doors/walls shuffling to make it a duplex (con: utilities would have to be included as I can't separate them easily). This would be 20-25k, total cost.  

Gross income: At that, I could rent it for 4800 total rent per month

Price: 520k (can't get them lower). The house is currently appraised for 570k on Zillow and it's def worth it. 

Financing (this is the tricky part): I only have 40k in cash and 78k in a HELOC (118k total).
Downpayment could be 10% (OO) 52k
So I'd have to use HELOC for part of downpayment ( which means another liability and payment)

Using the BP calculator after all expenses, heloc payment and such, it shows a cashflow of around $700/month only with an 11% COC ROI. Not a ton of cashflow but decent coc Roi. I could stop here.

Approach 2 (delayed semi-BRRRR): 
The house has a 450 SF well build insulated attached garage. I'd convert this into a very nice 1 bed apartment. I could do this for 50-60k (I have done this twice already with my guy). 

If I do that, I'd have to use up the rest of my HELOC and also come up with another 30-40k for the rehab in short term loan. 

Then I'd refinance and pay off the HELOC and other temp loan (OR I'd keep the Heloc maybe (8%) depending on what the numbers land at. 

The ADU would add another 1600 to my rent, and my net cashflow would then be around $1800/month.  But a 19.7 CoC ROI.

This is a lot of work for 1800/month. And in this current landscape, maybe it's Ok? Obviously you have to consider the benefits of RE: tax benefits, appreciation, equity as well. As Henry Washington said on his most recent podcast "this is real estate investing." 


Challenges: 
1. After I file my taxes for 2024 (in the next week) i might not qualify for the refi as my biz showed a loss). If I can't refi, I'd have to pay off that second rehab loan some way quickly. 

2. It would stretch me VERY thin financially with little buffer in my bank account for a period of time, or if I can't get tenants or something goes wrong, it could be very challenging. This is hard timing with a baby. 

Also part of the decision:   I am also considering turning the garage on my house where I live now into an ABB, which would be far less risk and produce similar cashflow, if not more. The only thing is then I'm not investing in other property and building the long term wealth there which I'd like.  Ideally I would do both, and In order to do that I'd have to come up with even more money to borrow/leverage as I don't have a lot of cash atm. Feels like a lot of leverage. 

Do you think this deal is worth the work and risk in this market? Obviously part of it depends on each investor and what you want and your life. But for you, what do you think? Questions? 

Thanks for your time! 

Robin 

PS here are the two reports if you want to see the full breakdown: 

Option one (no garage, less risk/reward): https://www.biggerpockets.com/analysis/rentals/4e19be22-4c7b...

Option two (garage/BRRR): https://drive.google.com/file/d/16nvuWkgXZKkLxtTjWcloAHVJdp-...



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Arman AhmedPro Member
Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 952 votes
1y

@Robin A Jackson

Robin, thanks for sharing such a detailed breakdown—this is super helpful for others too. Honestly, both approaches you outlined can work, but the biggest thing I'd weigh is your risk tolerance with a new baby and limited reserves. Sometimes the "singles and doubles" approach—less leverage, steady cash flow, and breathing room—beats swinging for the fences when life already has a lot on your plate. That said, the ADU conversion does give you a path to stronger long-term numbers, as long as you're comfortable with the added stress in the short term. I invest in the Midwest where deals often cash flow better without needing heavy lifts, but in higher-priced markets like Portland, your strategy of adding units is often the way to make numbers work.

[email protected]614-418-6081
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  • J CastroBusiness Member
    Lender · Florida · Member since 2025 · 702 posts · 253 votes
    1y

    Hey @Robin A Jackson 

    To determine if a deal is good for the BRRRR strategy, you need to assess the potential for cash flow, equity growth, and a successful refinance by calculating the rent-to-expense ratio, after-repair value (ARV), and the total invested capital needed to pull out your funds. You need to buy a property significantly below market value to add value through repairs and have a high ARV.

    For a more personalized service, DM me to discuss options. 

    JCREIG Capital Funding
    WebsiteView Page
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  • Arman AhmedPro Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 952 votes
    1y

    @Robin A Jackson

    Robin, thanks for sharing such a detailed breakdown—this is super helpful for others too. Honestly, both approaches you outlined can work, but the biggest thing I'd weigh is your risk tolerance with a new baby and limited reserves. Sometimes the "singles and doubles" approach—less leverage, steady cash flow, and breathing room—beats swinging for the fences when life already has a lot on your plate. That said, the ADU conversion does give you a path to stronger long-term numbers, as long as you're comfortable with the added stress in the short term. I invest in the Midwest where deals often cash flow better without needing heavy lifts, but in higher-priced markets like Portland, your strategy of adding units is often the way to make numbers work.

    [email protected]614-418-6081
    2Reply
  • Robin A Jackson
    OP
    Rental Property Investor · Portland, OR · Member since 2017 · 29 posts · 7 votes
    1y

    @Arman Ahmed I so appreciate your thoughtful reply to this. Thank you. Your take is right on the money and I like how you framed it. Right now I'm in a place where I need to bring in more cashflow and make some big moves around that, and also want to continue to add to my portfolio for long term wealth building. While I own some properties already, the truth is, I don't make much cashflow at the moment. I run another business as well which has been a bit up and down. Real estate is where I've made the consistent gains so I was just wanting to make another move there. 

    I really resonate with your take on timing and energy, and whether this is the right move for me, based on my current life circumstances. It's true, the ADU would generate good returns and also improve my lifestyle at home (a place for my parents to live part time as well).

    I do have some more reserves in the stock market so could tap into that if needed for rehab/unexpected costs. 

    I'll keep sitting with this and decide if I want to do both or skip the purchase for now. 

    That's also so interesting that you are in Ohio, and it looks like you provide a full service for investors in that market, way cool. I've been considering purchasing out of state and that is the area I was thinking. I often feel frustrated at the price tier in Portland compared to the midwest. You need so much more cash, and often make similar relatable returns. I may hit you up to learn more about what you do. thanks! 

    1Reply
  • Amber Clark
    Member since 2019 · 23 posts · 11 votes
    1y


    Hi Robin, a few angles to consider: 

    • On the numbers...
    • Base case (duplex only): $700/month cashflow, 11% CoC ROI → This is okay but not exciting for the level of leverage/risk. You'll be managing utilities and multiple tenants in a high-maintenance setup.
    • Garage ADU scenario: $1,800/month cashflow, 19.7% CoC ROI → Much better on paper. But you're all-in with your cash and HELOC, plus a temp loan, and banking on a refi that you're not sure you'll qualify for. That's thin ice.
    • Market factor: Portland is pricey and margins are tight. Most investors in your shoes don’t win on cashflow—they win on forced appreciation + tax benefits. If you’re banking purely on cashflow, this may not feel worth the squeeze.
    • On Risk...
    • HELOC leverage: Great tool, but risky if you don't have a cushion. An 8% HELOC eats at your margin and exposes you to variable rates.
    • Thin reserves: With a baby at home and limited buffer, one bad vacancy, repair, or refi delay could turn this deal into a stress bomb.
    • Execution risk: Converting garages/ADUs is your strength (you’ve done it before). That’s good, but it’s still more debt, more time, and more capital outlay than your current liquidity comfortably supports.
    1. Alternatives you mentioned...
    2. Garage ABB at your primary home: This is lower-risk, you control the environment, you don't need a refi, and the cashflow could rival the ADU play without stretching you thin. This feels like the safer immediate win.
    3. Wait and stack cash: Not sexy, but sometimes patience is the best strategy. If you save up while the ABB runs, you’ll be in a stronger position for the next bigger play.
    • If I were you...
    • I’d pass (or at least pause) on this Portland deal for now. It’s not that the house is bad—it’s that your financial position could be hindered if things don't go as planned. Deals are always around, but peace of mind and flexibility are harder to come by.
    • I’d do the ABB at your home garage first. Build cash reserves and proof of income. That way, when the right multi/duplex comes, you’re not forcing a deal—you’re ready for it.
    • If you’re itching to scale, maybe look outside Portland for a market with better yield. You’ll have more breathing room and less need to pile on risky leverage.

    My gut: This deal looks like "buying yourself a headache." With your current financial stretch and a baby in the mix, I'd prioritize stability + liquidity before a leveraged, thin-margin BRRRR. The ABB could give you that stability and still move you toward your long-term wealth goals.

    I wanted to ask - Do you manage your own rentals?

    Good Luck!

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  • Robin A Jackson
    OP
    Rental Property Investor · Portland, OR · Member since 2017 · 29 posts · 7 votes
    1y

    Hi @Amber Clark,

    Thanks for your patience with my reply here. I definitely wanted to get back to you after you took the time to create such a thoughtful and thorough response. I super appreciate your candor and insight.
    I actually decided to not do the deal a couple of hours before your message came in. And for many of the same reasons that you laid out. So when I read your message it was very helpful as it was very validating for me and also helped me think of a couple of different angles that I wasn't quite Landing in.

    I agree, I think I could do this deal but given my personal situation it's a bit too stressful and has too much leverage for me right now. If I didn't have a baby, I would probably take it on.

    I think I was thinking of this from the "old me" who was used to making hacking work and willing to do it. And it's time to grow : )

    I am deciding to do the ABB and wait for the next right moment. And approach it with different parameters moving forward. Less risk and leverage.
    I may look for another opportunity in a different Market. I've never done that before but it's definitely intriguing given where I live.

    To answer your question, I do currently work with a small property management company and I'm trying them out. I have a lot of friends who also own rentals and are always looking. Feel free to send me a short blurb or info and what you do and I'd be happy to keep it as a reference.

    Thank you!

    1Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    1y

    WHy not do the Garage ABB at your home and instead of LTR, explore MTR and STR options for MORE cashflow?

    [email protected]248-209-6824
    Logical Property Management4.9460 Reviews
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