Dallas, TX · Member since 2018 · 29 posts · 63 votes
Hello Bigger Pockets,
I have a quick question. I reside in the Dallas Fort Worth Area. Does properties in DFW cash flow? I have analysed lots of properties for the BRRRR method, but most don't cashflow. Most of the properties I analysed are less than $250k.
Am I missing something?
I'm also thinking. Do you think a best strategy would be to mix fixing and flipping with BRRRR.
Investor · North Richland Hills, TX · Member since 2013 · 1k+ posts · 1k+ votes
7y
It depends on your numbers. You need to create a model and find deals that fit this model.
Here are some ideas:
Look for areas with rents within $1200-$1600 range. This is your "bread and butter" 3bdr/3bath/2car houses
Your "all-in" cost must be below 100x of the rent: $120K-$160K. If it's more your cash flow will suffer or you will have to leave more equity in the deal when refinancing (e.g. 60% LTV instead of 75%)
Your level of rehab should be on par with recently sold houses in the area but don't overrehab: e.g., if they don't have granite countertops, neither should you
Try to keep your rehab within $10-20K range. Anything above that may prove to be too time consuming.
Be careful with problematic foundations. They may get repaired but doing that opens you for broken plumbing. So, you have to budget for it just in case.
If it does not cashflow, I would pass on it. Usually its a sign that a flip won't work either or the margin would be too thin to be worth the risk and effort.