BRRRR HELP! First time investing in real estate
Investor · Miami · Member since 2023 · 28 posts · 39 votes
BRRRR HELP! First time investing in real estate
Most Popular Reply
Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes
3yI would establish a team in whatever area you choose. With you being OOS you need boots on the ground. Find a trusted GC and PM. I would look more local if you can. Even if you have to go 1-2 hours away, it's better than multiple states.
31 Replies
- Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes3y
I would establish a team in whatever area you choose. With you being OOS you need boots on the ground. Find a trusted GC and PM. I would look more local if you can. Even if you have to go 1-2 hours away, it's better than multiple states.
- 3yRemington LymanBusiness MemberReal Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
I recommend you read this article on OOS investing. It explains the importance of creating your core four. You will need to get a local, rockstar Realtor, contractor, lender, and property manager.
https://www.biggerpockets.com/...
I invest locally in Columbus, Ohio - Real Estate Agent · WA · Member since 2021 · 254 posts · 173 votes3y
I would establish a team as soon as possible. Also start listening to BiggerPockets podcasts pertaining to your situations. Above all, I recommend you read this book that David Greene recommends - Long Distance Real Estate Investing by David Greene. Hope this helps!
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3yIs there a good strategy, resource, or tool that you use when trying to locate a good city/neighborhood for BRRRR?
Quote from @Caleb Brown:
I would establish a team in whatever area you choose. With you being OOS you need boots on the ground. Find a trusted GC and PM. I would look more local if you can. Even if you have to go 1-2 hours away, it's better than multiple states.
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @Remington Lyman:
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
I recommend you read this article on OOS investing. It explains the importance of creating your core four. You will need to get a local, rockstar Realtor, contractor, lender, and property manager.
https://www.biggerpockets.com/...
I invest locally in Columbus, OhioThank you! I will give it a read ! I heard a lot of positive things about investing in the Mid-west, just trying to figure out if its right for me
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @Ran Iarovich:
I would establish a team as soon as possible. Also start listening to BiggerPockets podcasts pertaining to your situations. Above all, I recommend you read this book that David Greene recommends - Long Distance Real Estate Investing by David Greene. Hope this helps!
A team of PM, realtor, lenders, contractors.. am I missing any others members? I will deff take your advice and read that book ! anything helps and I'm excited to start this journey, just not really sure where to begin lol
- Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes3y
Quote from @Account Closed:
Is there a good strategy, resource, or tool that you use when trying to locate a good city/neighborhood for BRRRR?Quote from @Caleb Brown:
I would establish a team in whatever area you choose. With you being OOS you need boots on the ground. Find a trusted GC and PM. I would look more local if you can. Even if you have to go 1-2 hours away, it's better than multiple states.
I'd look into the states bordering FL first, then look into hot cities and go from there
- Real Estate Agent · WA · Member since 2021 · 254 posts · 173 votes3y
Quote from @Account Closed:
Quote from @Ran Iarovich:
I would establish a team as soon as possible. Also start listening to BiggerPockets podcasts pertaining to your situations. Above all, I recommend you read this book that David Greene recommends - Long Distance Real Estate Investing by David Greene. Hope this helps!
A team of PM, realtor, lenders, contractors.. am I missing any others members? I will deff take your advice and read that book ! anything helps and I'm excited to start this journey, just not really sure where to begin lol
Team looks good to me, maybe add a mentor or two in there. Don't worry this is going to be life-changing for you, wishing you the best of luck!
- Columbus, OH · Member since 2023 · 427 posts · 254 votes3y
Determine your buying criteria. What is your budget? Do you solely want a cash flowing rental, or are you looking for long-term appreciation? What kind of rental will you be looking to do (short-term, medium-term, long-term, etc.)? What tenants will you target? Once you can answer all these, and develop a long-term plan, pick a market that accommodates your goals as well as your budget and criteria. Cleveland is a great marking to get a cash flowing single family or multi family at an affordable price. Columbus has some expensive, high appreciation areas, but also offers lower price points where rentals can cash flow. Once you hone in on 1-2 markets, develop a team within that market.
- Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes3y
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @Account Closed:
Determine your buying criteria. What is your budget? Do you solely want a cash flowing rental, or are you looking for long-term appreciation? What kind of rental will you be looking to do (short-term, medium-term, long-term, etc.)? What tenants will you target? Once you can answer all these, and develop a long-term plan, pick a market that accommodates your goals as well as your budget and criteria. Cleveland is a great marking to get a cash flowing single family or multi family at an affordable price. Columbus has some expensive, high appreciation areas, but also offers lower price points where rentals can cash flow. Once you hone in on 1-2 markets, develop a team within that market.
This is great starting point for me ! I plan on doing all cash, looking at houses under $100k with $50k-ish in rehab with the goal of both cash flowing rentals and long-term appreciation. Definitely helps me figure out a starting point. I'm going to be looking into Cleveland because that seems to be a good fit. What you do think about Shaker Heights though? :)
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @Bob S.:
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
Thanks for sharing that ! I'm in Miami so investing here will not be the smartest move for someone starting out. Any tips on how you manage all of your Ohio rentals while living in Florida?
- Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes3y
Quote from @Account Closed:
Quote from @Bob S.:
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
Thanks for sharing that ! I'm in Miami so investing here will not be the smartest move for someone starting out. Any tips on how you manage all of your Ohio rentals while living in Florida?
AGAIN I live in FL, I am actually I'm Miami for the weekend. and do ALL my business in OH,
AGAIN
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
- 3yPatrick DruryBusiness MemberReal Estate Agent · Columbus, OH & Cleveland OH · Member since 2021 · 1k+ posts · 2k+ votes
@Account Closed
Narrow in on a market that fits what you are looking for and then from there build your team in that market. You can find a lot of the people you are looking for on BP as others have mentioned. - 3yDan H.Pro MemberInvestor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
Quote from @Account Closed:
Quote from @Bob S.:
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
Thanks for sharing that ! I'm in Miami so investing here will not be the smartest move for someone starting out. Any tips on how you manage all of your Ohio rentals while living in Florida?
Why do you think Miami is not a good market for BRRRR?
I have done a fair amount of BRRRRs and value adds. I find them to require a lot of effort and a fair amount of skill. I highly recommend your first one not be OOS. I typically am on site multiple times a week and sometimes daily when I am doing a significant value add.
It is not clear to me why Miami is not a viable market for you to BRRRR (or at least to do a value add). I do my BRRRR and value adds in San Diego. I find high value markets provide the biggest return on rehab investment. Another way to look at it is that material costs are similar everywhere. The labor may be more expensive in high value markets (but surprisingly San Diego labor values are not that high). But the value that can be added in high value markets is greater than in low cost markets.
My last value add (purchased Dec 2021) was purchased off market at $2.25M and was appraised at purchase at $2.5M for the loan (so on purchase I "made" $250K). I then spent ~$60K rehabbing 3 of the 4 units to add ~$150K of value. I suspect in low cost markets it would be tough to obtain a value of 2.5 times the cost of the value add. The property has natural appreciation approaching $200K since purchase. Total net worth increase is near $540K. My point is not to brag but to show the value of value adds in high value areas.
BTW I do not consider doing a value add unless my underwriting shows it adds double the cost of the value add (A $50K value add must add at least $100K of value). This is because value adds require work and have a certain level of risk. I question if in low cost markets how feasible it is to achieve a value add 2 times the cost of the value add.
BTW 2: where do you think Ohio ranks in terms of RE owned by investors? You read BP and you may think it is near the highest or at least above average. According to Core Logic (a reliable source), Ohio has the 4th lowest percentage of investor RE. This is because experienced investors recognize that initial cash flow is not the same thing as actual cash flow received over a long hold period.
Total Investor Home Purchases Are Unlikely to Dip Due to Rising Interest Rates | CoreLogic®Good luck
- 3yRyan KellyBusiness MemberReal Estate Broker · Austin, TX · Member since 2018 · 1k+ posts · 1k+ votes
@AnnMarie Bacchus if a home is worth $50k to $75k in 2023, appreciation is not likely as it hasn’t appreciated much over it’s lifetime. Those types of properties are usually pure cash flow options. Nothing wrong with that, just don’t expect appreciation in areas that haven’t had any in the past.
Ryan Kelly Group - Keller Williams5109 Reviews - 3yJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votesHi AnnMarie, I personally love Columbus Ohio and as someone who works with a lot of out of state investors - there's so many catalysts for why you should invest here. Specifically, there's job growth (Intel, Honda, Amazon, Nationwide, etc) and the population is growing (unlike Cleveland or Cincy). I really see Columbus Ohio as an extremely safe bet for the next 10-20 years. Plus, there's still so many positive cash flowing and 1% deals here in Columbus Ohio. Just this month, I’ve gotten under contract for my clients for multiple 20%+ cash on cash rental properties so there’s definitely tons of opportunity here. As a local investor and agent here in Columbus, let me know if you have any questions or want to connect!
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
Jimmy Lieu, Red 1 Realty4.9119 Reviews - Investor · Miami · Member since 2023 · 28 posts · 39 votes3yThat seems to be the common factor everyone has been mentioning so far! I am definitely looking into building a team before moving forward.
Quote from @Patrick Drury:
@Account Closed
Narrow in on a market that fits what you are looking for and then from there build your team in that market. You can find a lot of the people you are looking for on BP as others have mentioned. - Real Estate Broker · Cleveland, OH · Member since 2018 · 227 posts · 133 votes3yThat's awesome! If you do decide to invest the in the Cleveland market, I can definitely send you some good referrals for agents, contractors, lenders, property managers and brokers in the area that I've had great experiences with! Best of luck, I already know you'll do great!
- Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes3y
Quote from @Dan H.:
Quote from @Account Closed:
Quote from @Bob S.:
Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
ALL you need to do is connect with those that do have experience and provide rentals to OOS cash buyers,,
BTW, I live in FL, and do all my business in OH, ,
Thanks for sharing that ! I'm in Miami so investing here will not be the smartest move for someone starting out. Any tips on how you manage all of your Ohio rentals while living in Florida?
Why do you think Miami is not a good market for BRRRR?
I have done a fair amount of BRRRRs and value adds. I find them to require a lot of effort and a fair amount of skill. I highly recommend your first one not be OOS. I typically am on site multiple times a week and sometimes daily when I am doing a significant value add.
It is not clear to me why Miami is not a viable market for you to BRRRR (or at least to do a value add). I do my BRRRR and value adds in San Diego. I find high value markets provide the biggest return on rehab investment. Another way to look at it is that material costs are similar everywhere. The labor may be more expensive in high value markets (but surprisingly San Diego labor values are not that high). But the value that can be added in high value markets is greater than in low cost markets.
My last value add (purchased Dec 2021) was purchased off market at $2.25M and was appraised at purchase at $2.5M for the loan (so on purchase I "made" $250K). I then spent ~$60K rehabbing 3 of the 4 units to add ~$150K of value. I suspect in low cost markets it would be tough to obtain a value of 2.5 times the cost of the value add. The property has natural appreciation approaching $200K since purchase. Total net worth increase is near $540K. My point is not to brag but to show the value of value adds in high value areas.
BTW I do not consider doing a value add unless my underwriting shows it adds double the cost of the value add (A $50K value add must add at least $100K of value). This is because value adds require work and have a certain level of risk. I question if in low cost markets how feasible it is to achieve a value add 2 times the cost of the value add.
BTW 2: where do you think Ohio ranks in terms of RE owned by investors? You read BP and you may think it is near the highest or at least above average. According to Core Logic (a reliable source), Ohio has the 4th lowest percentage of investor RE. This is because experienced investors recognize that initial cash flow is not the same thing as actual cash flow received over a long hold period.
Total Investor Home Purchases Are Unlikely to Dip Due to Rising Interest Rates | CoreLogic®Good luck
Where does Ohio rank in terms of OOS investors on BP? Above or below Tennessee? That'd be a neato stat to know.
- Lender · Houston, TX · Member since 2023 · 235 posts · 255 votes3y
Congrats on getting started in investing! You'll want to make sure you do your research in the local market, find an agent that works with investors, and put together a team of contractors or find a local GC.
- Rental Property Investor · Centreville, VA · Member since 2019 · 1k+ posts · 799 votes3y
Hi @Account Closed The BRRRR strategy is definitely very appealing as a starting out investor and it might take a while to find your 1st deal but once you get a grip of all the steps, it gets easier. Having said that, I wanted to bring forward the recent change in the cash out refinance rules where you will have to wait 6 months to 12 months. This is just one of the challenges in the current market.
Long distance Real estate investing is my favorite strategy and I would love to connect and see if I can add value to your goals. Feel free to reach out.
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3yI know the job market over in Ohio is amazing. I'm definitely going to be investing in Ohio, but I'm trying to narrow on what neighborhood to get my first property in. Let's connect! I'm currently looking for an agent and lender.
Quote from @Jimmy Lieu:
Hi AnnMarie, I personally love Columbus Ohio and as someone who works with a lot of out of state investors - there's so many catalysts for why you should invest here. Specifically, there's job growth (Intel, Honda, Amazon, Nationwide, etc) and the population is growing (unlike Cleveland or Cincy). I really see Columbus Ohio as an extremely safe bet for the next 10-20 years. Plus, there's still so many positive cash flowing and 1% deals here in Columbus Ohio. Just this month, I’ve gotten under contract for my clients for multiple 20%+ cash on cash rental properties so there’s definitely tons of opportunity here. As a local investor and agent here in Columbus, let me know if you have any questions or want to connect!Quote from @Account Closed:
I need some BRRRR advice !
I live in Miami so starting to invest in properties that are local will not be the best move. I read into BRRRR in Ohio. What should I know before I start investing out-of-state? BTW I have 0 experience
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @David Leggett:
That's awesome! If you do decide to invest the in the Cleveland market, I can definitely send you some good referrals for agents, contractors, lenders, property managers and brokers in the area that I've had great experiences with! Best of luck, I already know you'll do great!I would absolutely love that ! I will be investing in Ohio for sure (still narrowing down a good neighborhood). I would love to connect and get some referrals ! First and foremost I need a lender.
- Investor · Miami · Member since 2023 · 28 posts · 39 votes3y
Quote from @John Chong:
Congrats on getting started in investing! You'll want to make sure you do your research in the local market, find an agent that works with investors, and put together a team of contractors or find a local GC.
Thank you ! I am currently working on putting together a team :)
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