BRRRR - Buy, Rehab, Rent, Refinance, Repeat

User Stats

47
Posts
29
Votes
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
29
Votes |
47
Posts

Are there currently any markets for BRRRR properties < $100,000?

Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
Posted Nov 3 2022, 12:50

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In what market is this kind of a deal likely to happen today?

User Stats

160
Posts
114
Votes
Anthony McEvoy
  • Investor
  • Champaign, IL
114
Votes |
160
Posts
Anthony McEvoy
  • Investor
  • Champaign, IL
Replied Nov 3 2022, 14:36

Hello @Sam Bhattacharya - honestly, they're in many markets.  However, in today's environment, most are going to be found off market via methods such as mailers and networking.  Check foreclosure listings and sheriff sales, too.

Another way is to look for listings that aren't as obvious as a house in bad condition you can add value to.  Such as a two bedroom house that can easily be converted into a three bedroom.  Perhaps an unfinished basement that could be finished for another bedroom and bathroom.

I viewed a house over the summer that was two bedrooms because someone knocked down a wall in the third bedroom for a larger family room.  I recognized the opportunity because the square footage of the house seemed large for only two bedrooms for the area.

Best of luck!

User Stats

1,690
Posts
956
Votes
Bob Stevens#3 Managing Your Property Contributor
  • Real Estate Consultant
  • Cleveland
956
Votes |
1,690
Posts
Bob Stevens#3 Managing Your Property Contributor
  • Real Estate Consultant
  • Cleveland
Replied Nov 3 2022, 14:50
Quote from @Sam Bhattacharya:

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In yhat market is this kind of a deal likely to happen today?

Yes 100kish all in value about 120 -130k, rent 1200- 1400, In the Cleveland markets. Heck, I got two last month, all in 60k, rent 1400, value about 125k, All in 63k, rent 1200 value about 75- 80k,,,, I get them all the time. 

User Stats

47
Posts
29
Votes
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
29
Votes |
47
Posts
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
Replied Nov 4 2022, 07:27
Quote from @Anthony McEvoy:

Hello @Sam Bhattacharya - honestly, they're in many markets.  However, in today's environment, most are going to be found off market via methods such as mailers and networking.  Check foreclosure listings and sheriff sales, too.

Another way is to look for listings that aren't as obvious as a house in bad condition you can add value to.  Such as a two bedroom house that can easily be converted into a three bedroom.  Perhaps an unfinished basement that could be finished for another bedroom and bathroom.

I viewed a house over the summer that was two bedrooms because someone knocked down a wall in the third bedroom for a larger family room.  I recognized the opportunity because the square footage of the house seemed large for only two bedrooms for the area.

Best of luck!

Do you think the line between investors and wholesalers is becoming blurry?  Because the things you mention doing are what wholesalers do.

User Stats

53
Posts
20
Votes
Raymond Reyes
  • Real Estate Agent
  • Orlando, FL
20
Votes |
53
Posts
Raymond Reyes
  • Real Estate Agent
  • Orlando, FL
Replied Nov 4 2022, 07:40

@Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

User Stats

47
Posts
29
Votes
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
29
Votes |
47
Posts
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
Replied Nov 4 2022, 10:05
Quote from @Raymond Reyes:

Hey @Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.

User Stats

160
Posts
114
Votes
Anthony McEvoy
  • Investor
  • Champaign, IL
114
Votes |
160
Posts
Anthony McEvoy
  • Investor
  • Champaign, IL
Replied Nov 4 2022, 13:38
Quote from @Sam Bhattacharya:
Quote from @Anthony McEvoy:

Hello @Sam Bhattacharya - honestly, they're in many markets.  However, in today's environment, most are going to be found off market via methods such as mailers and networking.  Check foreclosure listings and sheriff sales, too.

Another way is to look for listings that aren't as obvious as a house in bad condition you can add value to.  Such as a two bedroom house that can easily be converted into a three bedroom.  Perhaps an unfinished basement that could be finished for another bedroom and bathroom.

I viewed a house over the summer that was two bedrooms because someone knocked down a wall in the third bedroom for a larger family room.  I recognized the opportunity because the square footage of the house seemed large for only two bedrooms for the area.

Best of luck!

Do you think the line between investors and wholesalers is becoming blurry?  Because the things you mention doing are what wholesalers do.


Wholesaling is a form of investing.  It is short term investing... often real short term.

Wholesalers and BRRRR Investors are seeking similar types of properties... properties at a discount. Wholesalers are seeking properties they can purchase at a discount while providing the "easy button" for the seller. It may not always be the condition of the property but the ability for the buyer to pay with cash, close quick, etc. BRRRR investors are looking for properties that are in physical distress (needing rehab) or have characteristics that are lagging behind the neighbor demands (i.e. too few beds/baths). Therefore, their property searching results in properties they can get at a discount compared to the after repair value (ARV).

Obviously, the end game is different with the wholesaler trying to resell it closer to market value while the BRRRR Investor is looking to refinance and hold.

I do not think the line is becoming blurry.  I think there is more overlap with some types of investing compared to others.

User Stats

53
Posts
20
Votes
Raymond Reyes
  • Real Estate Agent
  • Orlando, FL
20
Votes |
53
Posts
Raymond Reyes
  • Real Estate Agent
  • Orlando, FL
Replied Nov 4 2022, 15:05
Quote from @Sam Bhattacharya:
Quote from @Raymond Reyes:

@Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.


Yes, a smart investor friendly agent would, especially in those markets since the money is in the volume. Also, once you fix it up you'll need to sell it, so if the agent served you well the first time chances are you'll bring him on to sell and then to buy your next one. Is that to say that there's agents that will not give you the proper service because of the price? Of course. That's why it's important to make sure you vet and find the right realtor for what you're trying to do. Let them know your criteria and what you're trying to do and they should take care of you.

User Stats

1,161
Posts
863
Votes
Rob Bergeron
  • Real Estate Agent
  • Louisville, KY
863
Votes |
1,161
Posts
Rob Bergeron
  • Real Estate Agent
  • Louisville, KY
Replied Nov 4 2022, 19:03
Quote from @Sam Bhattacharya:
Quote from @Raymond Reyes:

@Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.


 I connect with my clients with wholesale deals. 

User Stats

47
Posts
29
Votes
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
29
Votes |
47
Posts
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
Replied Nov 4 2022, 19:55
Quote from @Rob Bergeron:
Quote from @Sam Bhattacharya:
Quote from @Raymond Reyes:

Hey @Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.


 I connect with my clients with wholesale deals. 

That’s great.  I doesn’t seem like many real estate agents do that.

User Stats

1,161
Posts
863
Votes
Rob Bergeron
  • Real Estate Agent
  • Louisville, KY
863
Votes |
1,161
Posts
Rob Bergeron
  • Real Estate Agent
  • Louisville, KY
Replied Nov 5 2022, 14:57
Quote from @Sam Bhattacharya:
Quote from @Rob Bergeron:
Quote from @Sam Bhattacharya:
Quote from @Raymond Reyes:

@Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.


 I connect with my clients with wholesale deals. 

That’s great.  I doesn’t seem like many real estate agents do that.

 I created a site to help local investors send their deals out to everyone's list. Great passive income source.

User Stats

1,111
Posts
695
Votes
Matthew Crivelli
  • Lender
  • Massachusetts
695
Votes |
1,111
Posts
Matthew Crivelli
  • Lender
  • Massachusetts
Replied Nov 5 2022, 15:01

@Sam Bhattacharya

Ohio my friend - the large markets in the state are still zooming and you can pick up housings for under 100k.

User Stats

412
Posts
628
Votes
Dave Poeppelmeier
  • Realtor
  • Maumee, OH
628
Votes |
412
Posts
Dave Poeppelmeier
  • Realtor
  • Maumee, OH
Replied Nov 6 2022, 04:41

@Sam Bhattacharya I agree with @Matthew Crivelli, you can find many houses for under $100k in decent neighborhoods in Toledo, especially ones that need work. Here's the thing though: everybody wants a BRRRR. But how are you going to Rehab it out of state? Try to find a contractor that won't gouge you the second they learn you're not local, or let a PM do it for a markup? Also, to get that kind of "Perfect" BRRRR is really difficult to do. There are investors in every market that have their mail/cold call teams working to find these perfect deals off-market, and many of them are local. Realtors typically won't help with that, because it's simply not what they do.

Now, since rates have gone up and the market is skidding to a major slowdown, the opportunity is getting better, even on the MLS as people who have to sell don't have 14 offers coming at them for anything that has 4 walls and a roof. If you don't want to do a mail/cold call campaign, you can find houses on the MLS that you can buy for $70k, put the $10-15k into it, and it will be worth $80-90k pretty easily, so you can get some of your money back. But to find the Home Run in your example on the MLS is really difficult. The biggest thing though is to get going doing something. If you can get into a nice, fixed up rental property and have minimal money in the project in the end, that's still a win. It all depends on how you want to proceed. Let me know if you have any other questions about Toledo, and best of luck to you!

User Stats

527
Posts
401
Votes
Billy Daniel
  • Rental Property Investor
  • Russellville, AR
401
Votes |
527
Posts
Billy Daniel
  • Rental Property Investor
  • Russellville, AR
Replied Nov 6 2022, 04:47
Quote from @Sam Bhattacharya:
Quote from @Raymond Reyes:

@Sam Bhattacharya I would say venture out to the south and midwest. As @Anthony McEvoy mentioned Cleveland, Cincy, Kentucky, Alabama. There are many markets out there where you can get these numbers. Find a market you feel comfortable in and build out your team! 

Are real estate agents likely to send investors these kind of listings?  It seems to me they want to stay above a $150,000 purchase price.


 Yes!  This is still pretty easy to find where I am.  I prefer working with investors, so shoot me a message and we can see if there's something here you might be interested in!

User Stats

3,226
Posts
4,402
Votes
Marcus Auerbach#3 Investor Psychology Contributor
  • Investor and Real Estate Agent
  • Milwaukee - Mequon, WI
4,402
Votes |
3,226
Posts
Marcus Auerbach#3 Investor Psychology Contributor
  • Investor and Real Estate Agent
  • Milwaukee - Mequon, WI
Replied Nov 6 2022, 06:08
Quote from @Sam Bhattacharya:

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In what market is this kind of a deal likely to happen today?

 25k is not a whole lot when you want to rehab a house. If you need a roof, that's half of your budget. If you add HVAC, plumbing and kitchen appliances the rest is gone. You have zero left for a new kitchen cabinets, countertops, new bathrooms, windows, flooring, paint, light fixtures, carpet, basement, landscaping, flatwork repair etc. 

We average between 50k and 80k. A 75k house will rarely only have 3 things wrong, they are usually overall beat up, so you need a new everything. A good number to do a quick estimate is about $50/sqft, at least here in Milwaukee. And when you budget more for rehab then for the house the math usually does not work. The solution is to go up in ARV, so you can keep the rehab budget below 25% of ARV.

User Stats

47
Posts
29
Votes
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
29
Votes |
47
Posts
Sam Bhattacharya
  • Rental Property Investor
  • Damascus, MD
Replied Nov 6 2022, 09:07
Quote from @Marcus Auerbach:
Quote from @Sam Bhattacharya:

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In what market is this kind of a deal likely to happen today?

 25k is not a whole lot when you want to rehab a house. If you need a roof, that's half of your budget. If you add HVAC, plumbing and kitchen appliances the rest is gone. You have zero left for a new kitchen cabinets, countertops, new bathrooms, windows, flooring, paint, light fixtures, carpet, basement, landscaping, flatwork repair etc. 

We average between 50k and 80k. A 75k house will rarely only have 3 things wrong, they are usually overall beat up, so you need a new everything. A good number to do a quick estimate is about $50/sqft, at least here in Milwaukee. And when you budget more for rehab then for the house the math usually does not work. The solution is to go up in ARV, so you can keep the rehab budget below 25% of ARV.

That's what I got from reading your posts in another thread.  

25k rehab costs may be a case of TGTBT.

User Stats

124
Posts
119
Votes
Anthony L Amos Jr
  • Real Estate Agent
  • Columbus, OH
119
Votes |
124
Posts
Anthony L Amos Jr
  • Real Estate Agent
  • Columbus, OH
Replied Nov 6 2022, 11:43
Quote from @Sam Bhattacharya:

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In what market is this kind of a deal likely to happen today?


 Toledo, OH

User Stats

24,750
Posts
16,441
Votes
James Wise#1 General Real Estate Investing Contributor
  • Real Estate Broker
  • Cleveland, OH
16,441
Votes |
24,750
Posts
James Wise#1 General Real Estate Investing Contributor
  • Real Estate Broker
  • Cleveland, OH
Replied Nov 11 2022, 06:38
Quote from @Sam Bhattacharya:

Let's say you're looking for the following:

Purchase price = $75,000

Rehab cost = $25,000

ARV = $150,000

In what market is this kind of a deal likely to happen today?

 None....Only way that deal would work is if the house you bought for $75k was really worth $100k+ but the seller didn't realize it. That happening isn't really a market thing so much as a marketing thing. You would need a massive marketing budget and the time and resources to talk with 1,000's of sellers before hitting big on a deal like that.