BRRR Analysis Help on First Investment
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Hello, I'm unsure if I made a good deal and if the BRRR method will work for this property. I received comps from 3 agents in the area, and all were different here is the range if I did a higher-end reno for the area.
Comps on ARV 230K-380K - I decided to use $290K in the report
Rental target $1600-$1850/unit/month - I decided on $1650/unit/ in the report
I estimated all costs on the higher end to ensure I was being realistic and not trying to overestimate.
Also, as an FYI, I bought this property at auction, and I have not seen the interior however, the image I attached is the exterior as it is today, and it is in good condition. A contractor went out and looked at the exterior and did not recommend any repairs from what he could see (he was assessing if he saw any safety issues or foundation concerns, or significant items such as windows, roof, etc.). The last permits for reno were pulled in 2008, but I couldn't obtain what those permits were for.
The cash flow looks a little low. Can anyone help me understand this report and if I made a good deal or if the cash flow is too low? I'm unsure what my target should be for cash flow?
a few reactions:
-the insurance is high - you should be able to do better than $3600 a year
-the cash flow isn't low if it's accurate, but what are you basing it on? do you have actual rental comps that support $1650 per unit?
-what are you basing the rehab on?
Hi! Thanks for the reply. Our messages must have crossed. See my last reply. I've updated the report based on feedback and attached the link to my last reply as well. I don't want to duplicate it here to confuse anyone trying to provide feedback. My comps are from realtors and current rentals on market in that zip code.
@Nicholas L. ignore my last reply. I realized this is the duplicate thread that I created because I thought my post wasn't saving. So sorry to everyone for the confusion. Here is the link to the other thread.
BRRR Analysis Help on First Investment (biggerpockets.com)
I'd like to consider this one closed. I'm unable to delete it.