BRRRR in Memphis from long distance.

Investor · GA · Member since 2024 · 5 posts · 20 votes

First post on BP, hi all.

I'm engaging Memphis agents so I can attempt a first BRRRR. This will be a long distance BRRRR (I'm located in California).

I've got 8 turn-key SFRs but now want the money to work harder.

Do out of state BRRRR investors have tips on getting started and/or pitfalls to avoid?

Memphis investors, is it realistic to expect deals where I can buy a SFH for $100,000, spend $40,000 on renovations, and then have it appraised for $170,000+? Trying to start small, learn the process, then do a few of these a year if it's successful.

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Scott Bowen

Member since 2023 · 21 posts · 18 votes

Hi @Ryan G.,

I currently own 5 SFHs in Memphis and just completed my first BRRRR there. Like you, I wanted a better return on my money which is why I am moving towards BRRRRs going forward.

For my BRRRR property I purchased it for $68K and spent $20K in rehab. It appraised for $120K, and rented for $1095 a month. At 70% LTV this left 10K in the deal and achieved a 14% CoC. This was in a C+ area of 38128.

I think the numbers you mentioned are doable. I recommend getting a scope of work from your PM while you're still under contract so you have an accurate estimate of what your rehab costs will be.

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Nader Shariff
Detroit, MI · Member since 2020 · 150 posts · 68 votes
2y
Hey there, you should Speak to @Joseph Bui. He has done quite a few in Memphis and has done a few in Detroit with me. He should be able to help answers your questions about Memphis.

1 Reply
Joseph Bui
Lender · Nationwide · Member since 2023 · 362 posts · 237 votes
2y
Quote from @Nader Shariff:

Hey there, you should Speak to @Joseph Bui. He has done quite a few in Memphis and has done a few in Detroit with me. He should be able to help answers your questions about Memphis.

Hey Ryan, happy to connect and share my experience with Memphis.
2 Reply
Samuel DioufBusiness Member
Real Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
2y
Those returns sound reasonable. I know you can achieve these numbers in Columbus, Ohio.
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Michael SmytheBusiness Member
Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
2y
@Ryan G. you should speak with @Chris Clothier with REI Nation. They've done thousands of turnkeys in Memphis and elsewhere.
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Jordan RayBusiness Member
Real Estate Agent · Memphis, TN · Member since 2023 · 642 posts · 337 votes
2y
Quote from @Ryan G.:

First post on BP, hi all.

I'm engaging Memphis agents so I can attempt a first BRRRR. This will be a long distance BRRRR (I'm located in California).

I've got 8 turn-key SFRs but now want the money to work harder.

Do out of state BRRRR investors have tips on getting started and/or pitfalls to avoid?
Memphis investors, is it realistic to expect deals where I can buy a SFH for $100,000, spend $40,000 on renovations, and then have it appraised for $170,000+? Trying to start small, learn the process, then do a few of these a year if it's successful.

Hey Ryan! Welcome to BiggerPockets & congrats on checking into new markets! Memphis TN is a great place to invest & I personally have a deal under contract right now with a $175K ARV, $25K in Rehab & the purchase price is $107K. I am constantly helping out-of-state investors close deals that look like this as well! Please feel free to reach out and I would love to help you expand your portfolio! Talk soon!
[email protected]662-642-1458
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2 Reply
Devvrat Kumar
Realtor · Memphis · Member since 2021 · 48 posts · 26 votes
2y
I am in Memphis. I would be glad to connect and share insight about the market.
1 Reply
Chris ClothierBusiness Member
Rental Property Investor · memphis, TN · Member since 2009 · 2k+ posts · 3k+ votes
2y
Quote from @Ryan G.:

First post on BP, hi all.

I'm engaging Memphis agents so I can attempt a first BRRRR. This will be a long distance BRRRR (I'm located in California).

I've got 8 turn-key SFRs but now want the money to work harder.

Do out of state BRRRR investors have tips on getting started and/or pitfalls to avoid?
Memphis investors, is it realistic to expect deals where I can buy a SFH for $100,000, spend $40,000 on renovations, and then have it appraised for $170,000+? Trying to start small, learn the process, then do a few of these a year if it's successful.

Love your post and congrats on the 8 doors already. I'm not sure you are going to be able to find a property for $100,000 to sell to an end-user at $170,000 with $40,000k in work from afar. I think that most of the deals that pencil this way are going to be fought over by the local investors. Connect with Dean Harris here on BP. I can't tag him but I think he is an agent at Crestcore. He talks on BP quite often about the BRRRR deals he does in Memphis. He may be a much better resource on the possibility of hitting these numbers.
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Jake BakerBusiness Member
Flipper/Rehabber · San Diego, CA · Member since 2020 · 1k+ posts · 696 votes
2y
@Ryan G.
Those numbers sound reasonable. 40k rehab may be a little low for most projects. We do 20 Flips/BRRRRs per year in Jacksonville FL and we use a hybrid approach. It is very hard to "perfect BRRRR" here with consistency or anywhere for that matter with today's rate and insurance costs. Of those 20 projects, we BRRRR 8-10 per year, and the flips supplement the money left in the BRRRRs.
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2 Reply
Scott Bowen
Member since 2023 · 21 posts · 18 votes
2y
Hi @Ryan G.,

I currently own 5 SFHs in Memphis and just completed my first BRRRR there. Like you, I wanted a better return on my money which is why I am moving towards BRRRRs going forward.

For my BRRRR property I purchased it for $68K and spent $20K in rehab. It appraised for $120K, and rented for $1095 a month. At 70% LTV this left 10K in the deal and achieved a 14% CoC. This was in a C+ area of 38128.

I think the numbers you mentioned are doable. I recommend getting a scope of work from your PM while you're still under contract so you have an accurate estimate of what your rehab costs will be.

5 Reply
James WachobBusiness Member
Real Estate Broker · Memphis, TN · Member since 2015 · 1k+ posts · 891 votes
2y
Memphis holds a lot of GREAT opportunities! I'd like to be your contact for anything REI related in Memphis, TN.
0 Reply
Joe DerobertisPro Member
Altadena, CA · Member since 2014 · 70 posts · 42 votes
2y
Quote from @Scott Bowen:

Hi @Ryan G.,

I currently own 5 SFHs in Memphis and just completed my first BRRRR there. Like you, I wanted a better return on my money which is why I am moving towards BRRRRs going forward.

For my BRRRR property I purchased it for $68K and spent $20K in rehab. It appraised for $120K, and rented for $1095 a month. At 70% LTV this left 10K in the deal and achieved a 14% CoC. This was in a C+ area of 38128.

I think the numbers you mentioned are doable. I recommend getting a scope of work from your PM while you're still under contract so you have an accurate estimate of what your rehab costs will be.

Hey @Scott Bowen,
That sounds like a great deal! I'd be very interested to hear more about how you found that deal and who you worked with for the rehab and PM etc... I've just closed on two turnkey deals in Memphis and so far it's been a good experience, so just weighing my next options and I think the BRRRR method will very likely increase my CoC return so just trying to build up some contacts should I decide to go that route as my next experiment. I'm out of state so hoping to connect with folks that have had good experiences.
If you're willing to share feel free to DM me!
Thanks!
2 Reply
Dean HarrisBusiness Member
Real Estate Agent · Memphis, TN · Member since 2015 · 1k+ posts · 1k+ votes
2y
@Joe Derobertis Im happy to talk BRRRR in Memphs, TN. I have completed over 40 of them here in Memphis myself and assisted countless other clients with the strategy
Talk soon
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2 Reply
Joe DerobertisPro Member
Altadena, CA · Member since 2014 · 70 posts · 42 votes
2y
Quote from @Dean Harris:

@Joe Derobertis Im happy to talk BRRRR in Memphs, TN. I have completed over 40 of them here in Memphis myself and assisted countless other clients with the strategy
Talk soon

@Dean Harris would be very interested in talking with you. I've actually started some conversations with some folks from your team already, but would be happy to talk with you directly.
2 Reply
Chris ClothierBusiness Member
Rental Property Investor · memphis, TN · Member since 2009 · 2k+ posts · 3k+ votes
2y
@Joe Derobertis - Dean will be a great contact in Memphis for BRRRR. He is a poster here on BP who has talked about it the most, and for the longest as far as I can remember, so he will be a quality contact for helping build your team. Y

@Scott Bowen - I've read some of your other posts, and I love how you dove straight into investing based on your own criteria and goals. How long have you owned your BRRRR in 38128, and has it panned out so far the way you expected? I would love to know your experience because buying at that price in Memphis in that area with such a small amount of work done has caused issues for others in the past. Best of luck as you go forward, and congrats on your success so far!

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0 Reply
Tyler Tapley
Real Estate Agent · Memphis, TN. · Member since 2018 · 175 posts · 101 votes
2y
You can still do BRRRR deals here. Some are incredibly simple and require little to no repairs. You can search my name and see some interesting examples from clients that are pretty cool.
2 Reply
Dean HarrisBusiness Member
Real Estate Agent · Memphis, TN · Member since 2015 · 1k+ posts · 1k+ votes
2y
Quote from @Joe Derobertis:

Quote from @Dean Harris:

@Joe Derobertis Im happy to talk BRRRR in Memphs, TN. I have completed over 40 of them here in Memphis myself and assisted countless other clients with the strategy
Talk soon

@Dean Harris would be very interested in talking with you. I've actually started some conversations with some folks from your team already, but would be happy to talk with you directly.

@Joe Derobertis Anytime!! Happy to hop on a call!
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0 Reply
Julia Lyrberg
Lender · TX · Member since 2024 · 308 posts · 197 votes
2y
Sounds like you're in a great spot with 8 turn-key SFRs and now wanting to get into BRRRR! For out-of-state investing, one of the biggest tips is building a solid local team—an agent, contractor, and property manager you can trust is key. Also, be prepared for potential delays and unexpected costs, especially with long-distance renovations.

1 Reply
Logan Lambert
Lender · Kingsville, MD · Member since 2023 · 103 posts · 35 votes
2y
Quote from @Ryan G.:

First post on BP, hi all.

I'm engaging Memphis agents so I can attempt a first BRRRR. This will be a long distance BRRRR (I'm located in California).

I've got 8 turn-key SFRs but now want the money to work harder.

Do out of state BRRRR investors have tips on getting started and/or pitfalls to avoid?
Memphis investors, is it realistic to expect deals where I can buy a SFH for $100,000, spend $40,000 on renovations, and then have it appraised for $170,000+? Trying to start small, learn the process, then do a few of these a year if it's successful.

Hey,
Great questions here. As an out of state investor, I would find a solid agent who understands real estate investing in the area and utilize their expertise.

Also, are you going to acquire the properties by a hard money loan? Or cash?
1 Reply
Oren Kachel
Member since 2019 · 140 posts · 24 votes
1y
Quote from @James Wachob:

Memphis holds a lot of GREAT opportunities! I'd like to be your contact for anything REI related in Memphis, TN.

hey @James Wachob ! im looking at a MF between the airport and the UN. any thoughts?
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