going to have $130k after refi closing next week

[Charles Crotts]

Wondering what is best way to invest this money in rentals.  

1. buy 2 or 3 positive cash flowing rentals?

2 buy one project and rehab and refi.

I feel like that if I complete number 1 then I'm going to be out of money to find the next deal and was wondering the turn around to financing the next house.  credit is good and i have money in other places.

If i complete number 2, unless i get an amazing deal up front I'm going to have less money left after the 25% down

I guess i need advice on which direction to head

Thanks in advance

[Melissa Justice]

@Charles Crotts,

Great question and it's awesome that you're thinking ahead about how to maximize your capital and momentum. You're already on the right track by weighing both the buy-and-hold and BRRRR-style strategies.

Let’s break this down a bit:

Option 1: Buy 2–3 Positive Cash Flowing Rentals
Pros:
Immediate, stable income
Lower risk and lower stress (especially if you're new)
You lock in today’s interest rates and start building equity + appreciation

Cons:
Your capital is tied up after the purchases (unless you buy below market value)
Scaling becomes slower unless you have more capital coming in or look to HELOCs/partnerships

This is a great path for investors who want consistent returns, less construction risk, and strong property management in place. If you’re in a landlord-friendly, cash-flowing market (Midwest, Southeast, etc.), this route can work very well.

Option 2: Buy, Rehab, Refi (aka BRRRR)
Pros:
You can recycle your capital and potentially get much of your money back out
Faster equity growth if the rehab and appraisal go well
Great for building a portfolio faster with less cash over time

Cons:
Rehab risk (delays, budgets, bad contractors)
Refinance timing is uncertain, especially in today’s lending environment
You need to find a truly good deal up front - ideally 70–75% of ARV all-in

BRRRR works well when you have solid systems in place and can find below-market deals in appreciating areas. But if you’re newer, it can be more complex to manage unless you have a great team.

If your credit is good and you have capital tied up elsewhere, you may want to do a hybrid approach:

Start with 1–2 solid cash flowing rentals (turnkey or light cosmetic rehab) to get the ball rolling.
Then actively hunt for a value-add project once you’ve stabilized and built some confidence.
Look into cash-out refinances or HELOCs on existing properties later to keep funding new purchases.
Consider out-of-state markets if your local area doesn’t support your cash flow or equity goals.

Also, think about your timeline. If you want to replace income or scale faster, BRRRR can help you snowball. If you want predictability and passive income, buy-and-hold is often the better play early on.

Happy to dig into any numbers or markets you’re looking at - feel free to DM me sample deals or questions!

You're in a great position. It’s all about matching your next move with your long-term strategy. 

Best of luck,

Melissa