Bad time for a brrrr deal ???? HELP
Hi Guys,
I am a newbie first time investor. Found a property on the MLS for 65,000 . Needs about 80k in renovations. Arv is 180k-200k . With built in equity . Motivated seller. Rent in the area low end 1100 higher end 1200-1600
It’s a D property on a B-C location. Taxes are $1175.
I am thinking of pulling the trigger and offering $46,000. What are your thoughts during these current times. Should I proceed with the offer or wait it out and save my cash.
If I do buy it I'm planning to use my business LOC for renovations or possibly getting a hard money loan.
What are your thoughts ? Please help!
Most Popular Reply
First of all, @Edgar Hernandez, congrats on having the best profile pic on BP.
I think this is probably a better flip candidate then a BRRRR. You're going to end up well below the 1% (rent to ARV), so will be tough to cash flow. My approach would be to try and flip. If the market conditions aren't conducive at that time, refi and rent to keep it afloat. Worse case is you break even for a couple of years then sell. That longer term hold will mean significantly lower GC taxes (could even defer 100% with a 1031 exchange).