Updated over 1 year ago on . Most recent reply
newbie BRRRR investor - does this sample deal look good?
Hi - just starting to get into the BRRRR deal concept - here is an example of a deal that I am getting.
I am considering doing a flip vs buy and hold.
Again the below is just a best estimate - Do you guys think I'm factoring in 99% of the expected costs?
Most Popular Reply
Yes, There are some shorter time frames on 1031 exchange you have to use a seasoned 1031 company. In most cases there is very little fix and flip profits as a long term benefit. This is just my opinion because in over 18+ years in banking I have had thousands of customers who started off doing fix and flips change gears and then buy and hold. If you hold it for 8-10 months you can start the application process and close on or after the 12th month.
It makes very little sense to me to fix and flip a property if it cash flows and you have a good enough ARV to pull cash out and repeat the process. Again my advice comes from working with investors like "Rich Dad, Poor Dad" whose whole philosophy is if it cash flow dont sell it use the equity to buy another property. Avoid the capital gains and use your Shedule E, LLC or business returns to offset passive income with great tax deductions and write offs.
A fix and Flip can offer a good way to get some fast cash and deal with taxes in aother manner but again its still not the long game I think works best. Especially now that home values are about to increase again, mostly in part to lower rates as of last week and still lower to come after the election and into 2025.
As these mortgage rates continue to drop further it will cause more buyers to come off of the side line putting in offers. That will cause a sellers market due to multiple bids over bids and properties now appraising back on positives. That also means longer holds will appreciate faster allowing you to buy a TLC property, renovate and benefit on the ARV which will gain quicker in a market similar to 2021-2022.
Reason why I mention this is if your buying fix and flips your prices will start to go up making it harder to use all cash to buy them.
It makes very little sense to me to fix and flip a property if it cash flows and you have a good enough ARV to pull cash out and repeat the process. Again my advice comes from working with investors like "Rich Dad, Poor Dad" whose whole philosophy is if it cash flow dont sell it use the equity to buy another property. Avoid the capital gains and use your Shedule E, LLC or business returns to offset passive income with great tax deductions and write offs.
A fix and Flip can offer a good way to get some fast cash and deal with taxes in aother manner but again its still not the long game I think works best. Especially now that home values are about to increase again, mostly in part to lower rates as of last week and still lower to come after the election and into 2025.
As these mortgage rates continue to drop further it will cause more buyers to come off of the side line putting in offers. That will cause a sellers market due to multiple bids over bids and properties now appraising back on positives. That also means longer holds will appreciate faster allowing you to buy a TLC property, renovate and benefit on the ARV which will gain quicker in a market similar to 2021-2022.
Reason why I mention this is if your buying fix and flips your prices will start to go up making it harder to use all cash to buy them.