Rental Property Investor · Anderson, SC · Member since 2020 · 38 posts · 12 votes
Good Evening BP community, today I drove by a property with a "for sale by owner" sign in their front yard. I made the call and was given their asking price. After running some numbers, I realized this property has a great opportunity for its area. I finalized my deal and considered it to be a great deal! Yet, I am not quite sure what price would make it a Homerun! This is a SFH planned for a BRRRR exit strategy.
What numbers would classify your investment(s) as a HOMERUN?
Rental Property Investor · Anderson, SC · Member since 2020 · 38 posts · 12 votes
5y
@Joe Villeneuve You're right, I know the better the numbers the better the deal. It's not necessarily the label that matters, but the knowledge and experience. We all can have different numbers and categorize each deal differently. With that being said, all I am honestly looking for is your experience finding the best deals in your portfolio. What do you look for?
In simple terms, if I use the BRRRR strategy and I am able to pull all my money out and still cash flow $300 or better I consider it a home run. I have no money in the deal, generate $3600 a year and take advantage of all the tax advantages of mortgage interest deduction, property tax deduction, mortgage pay down, depreciation my ROI is actually much better. You can argue with yourself whether $300 is a home run versus $400 or $500 snd so on, but your tenant is covering all your expenses plus cash flow.
@Joe Villeneuve You're right, I know the better the numbers the better the deal. It's not necessarily the label that matters, but the knowledge and experience. We all can have different numbers and categorize each deal differently. With that being said, all I am honestly looking for is your experience finding the best deals in your portfolio. What do you look for?
Cash flow and profit. It depends on what my plan says at the timeline I'm at in that plan. That will dictate what cash flow I'm looking for, what profit I need to make, and what entrance (cash available) I have. Combine all of those things and find the market that will generate those numbers using one of the strategies I like to use.
Rental Property Investor · Anderson, SC · Member since 2020 · 38 posts · 12 votes
5y
@Kenneth Garrett Thank you for your feedback! Yeah, I usually set 300 to be my standard for cashflow. I know there are several opportunities to obtain much more cash flow, but it all depends on rent and operating expenses. BRRRR is known to use leverage and obtain a property with great cashflow, which is why I chose this strategy.