Seattle, WA · Member since 2017 · 11 posts · 2 votes
Hello all, I have a question that stems from learning more about the BRRRR Calculator and the overall process. When in the rehab phase of such a deal, I would assume that you do not have any monthly income from rent. Lets say it takes you 2 months to rehab a property and get tenants signed on to the lease. Thats 2 months that you would have to be able to cover up front either with your initial loan or your own cash.
Investor · Parker, CO · Member since 2016 · 59 posts · 37 votes
9y
hi @Robin Croen, it's funny you mention that because I had the same question today. It seems like something that was possibly overlooked when the BRRRR calculator was developed. Unless you have inherited tenants, it's unlikely you are getting any income during the first "R" of BRRRR. It would be nice if the calculator backed this out and until then, I'm going to manually account for this on a separate spreadsheet.
Guy with Great Hair · Austin, TX · Member since 2013 · 2k+ posts · 4k+ votes
9y
It's quite unlikely you won't have rent during rehab and maybe for an extended period after rehab. So yeah you have to account for some holding costs during rehab. Insurance, utilities, etc.
Don't do your deals so tight that 2-3 months of electricity bills knock you out. I just plan for this stuff in rehab costs.
Investor · Parker, CO · Member since 2016 · 59 posts · 37 votes
9y
hi @Robin Croen, it's funny you mention that because I had the same question today. It seems like something that was possibly overlooked when the BRRRR calculator was developed. Unless you have inherited tenants, it's unlikely you are getting any income during the first "R" of BRRRR. It would be nice if the calculator backed this out and until then, I'm going to manually account for this on a separate spreadsheet.
Seattle, WA · Member since 2017 · 11 posts · 2 votes
9y
I think I found it! If you look under the "Rehab Period" tab on the results page, the "Holding Costs" field is dependent on how long your rehab period is. I didn't do the math, but it looks like if you add up your PITI and any other monthly expenses and multiply by the number of months of rehab, you get the holding costs.
Investor · Grosse Pointe Shores, MI · Member since 2017 · 160 posts · 74 votes
9y
I've been playing with the BRRRR calculator today as well, and I just don't find where it lists the equity that is returned to you at refi. Anyone see it?