First time BRRRer and at a point where we are finishing a rehab and trying to figuring the exit strategy. I know, we were suppose to know this at the beginning but just want to take action.
The house… is where I grew up. Both parents passed and the house was “Act of Donation” to me. The house is/was in bad shape and at the time of figuring out the estate with my 2 sisters the value was about $75k. We, wife and I, decided to buy out my sisters and rehab the house with our own money. Forward 9 months we are just about finished the rehab. Rehab costs are going to be about $60k(little more than expected) including new roof, exterior, interior, etc…
The house is located in south Louisiana. Estimated ARV is about $225k-$250K and market at this time is strong according to local realtors. Rent for this house could be about $1.7k to $2k.
Situation… We got into BRRR for passive income and for the first house, this was, I guess, is a good start. We used our own money for all rehab and holding costs. We are estimating to complete the project in about 3-4 weeks. But we are also getting very short on money but will have just enough but we need to get our rehab money back out ASAP.
We current do not have income(W2) since we left careers to attempt REI.
I see 2 exit options:
1 - Quick exit back to financial black, out right sell the house. But this will not give us the passive income we initial wanted to do.
2 - Rent it and somehow get our rehab cost back out. Challenges will be the time from time of rental to able to get a mortgage. Or maybe I can’t get a mortgage and have to get a cash out refinance since I already own it. Either way I believe there will be a long (or too long for us) seasoning period.
So I am looking to experts for help with this discussion or maybe there is an option I am not aware of.
Any advise is appreciated.