What is the Best BRRR you have completed?

Question

Where do your BRRRs stack up? What is your best BRRR, what were the numbers, where was it?

Alecia Loveless · Answer

@Bobby Paquette I purchased a 3/1 for $99,000. It was only supposed to need about $15,000 renovation. Once we got into the renovation we discovered the inspector missed all sorts of things and the renovation cost about $50,000. Took a year to complete. Got a set of tenants in for $1600 + utilities.

The pandemic happened and prices went crazy here. The value of the 3/1 home went up to $349,000.

Had another property need an extensive renovation. Completed the BRRRR process on the 3/1 and took out $150,000 which was the maximum amount the rent would properly support. It still cash flows $250/month plus all bills and reserves.

Ended up not being able to find a contractor to complete the renovation to the other property which was a duplex only cash flowing $600/month in time for my insurance company to not drop my coverage and sold it.

Used the $150,000 to buy an 8 unit that cash flows $4000 /month currently.

Ryan Fox · Answer

@Bobby Paquette- This isn't a traditional BRRRR by any means, but I'll share anyways.

Purchase price: $109k

Tenant-occupied at purchase paying $950 / month

Financed with: securities-backed line of credit @ 2.49% interest-only fixed for 7 years

Monthly interest payment: $250 / month

A year after purchase, a drunk driver drove into the property, causing $107k worth of damage.

Luckily, no one was hurt and the insurance covered all damages.

The existing tenant moved out.

After the insurance-funded rehab, the property was worth $160k.

New tenant moved in at $1225 / month.

I haven't refinanced out of the line of credit financing because I'm hanging on to the 2.49% fixed rate.

This was in Independence, MO.

Michael Smythe · Answer

The next one:)

Andrew Syrios · Answer

Bought a 3-bed, 1.5 bath raised ranch in south KC for $28,250. Put about $15,000 into it and it appraised for $120,000. That was back in 2012 though and was a bank owned property. Don't see much of that these days.

Bobby Paquette · Answer

Still pretty good numbers I would say

Ryan Fox · Answer

@Bobby Paquette- So my fixed costs are the $250 / mo interest payment, $116 / mo in property taxes, $105 / mo in insurance, and $98 / mo in property management, which totals $569.

$1,225 rent - $569 fixed costs = $656 / mo cash flow before vacancy, repairs, ect.

Bobby Paquette · Answer

Oh wow, different for sure. So your only monthly payment is the $250/Mo interest payment on the line of credit?

What is the Best BRRR you have completed?

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