Rental Property Investor · Portland, ME · Member since 2026 · 6 posts · 4 votes
Hi all,
New to BP and trying to learn!
I'm trying to practice using these analysis tools and found a property in my area that I think could be a good investment. Looking at the report though, the numbers don't look too appealing. Can someone help me analyze this report and tell me if my numbers are right? Thank you in advance.
The fact that you're practicing deal analysis before jumping into a purchase puts you ahead of most new investors. A few thoughts on your situation:
1. If the numbers don't look appealing, that's actually the analysis tool doing its job. Most properties on the market won't cash flow - that's why finding good deals requires patience and volume.
2. Some things to double-check in your inputs:
- Are your rent estimates conservative? Pull 3-5 active listings for similar properties in the area to verify
- Did you include all expenses? (Vacancy 8-10%, maintenance 5-8%, cap-ex 5-10%, PM 8-10% even if self-managing)
- What interest rate did you use? Today's rates are different than a year ago
3. For Portland, ME specifically - it's a solid rental market but purchase prices have increased faster than rents lately. You might need to look at value-add opportunities (light rehab to increase rent) rather than turnkey properties.
What's your investment strategy? Long-term rental, house hack, or something else? That context might help us give more specific feedback on whether this property could work for you.
Thanks for the reply Alex. I'm really interested in doing a BRRRR. This house definitely needs a heavy rehab, but the neighborhood is highly desirable. That's why I can see it as a rehab and rent.
I estimated my expenses to be 28-30%. (I don't remember exactly and I don't know how to go back into the report and figure it out.) I estimated my rent after rehab to be pretty liberal at $3000 a month. I also used a conservative 6.5% for the interest rate.
I think I messed up on the refinance after rehab.. because it starts of as a good deal, but ends up losing money down the line. Thanks again!
Hey @Gregory McCarthyBRRRR is a great strategy, however, I'm not a huge fan of this one. I think it could be better suited for a flip. Here are some of my notes and questions:
- Do you plan on doing some of the work yourself? If not, I think $50k for a rehab could be a little low. I could easily see engineered hardwood here costing $10k-$15k and painting costing another $10k. (Paint prices are crazy right now!). That’s already half of your estimated budget. Roof - $10k. Heat system – at least $10k. We havcen’t gotten to the kitchen or bathroom yet. Also, based on how the paint is flaking, I would suspect lead paint, which could be a big headache.
- For the after refi interest rate, I would use 7% to be safe.
- Closing costs at purchase should be 2%-3% of loan amount if it is a conventional loan (which I don’t know that this house would qualify for). If you go hard money, you’re talking points and a much higher interest rate for the initial loan. When you go to refi, you’re probably talking another 2% in closing costs.
So, if you rent it for $3k/month and your post refi expenses are $3100, you're immediately in the red, and that's if everything goes right. I don't want to be a debbie downer, but I've done a few BRRRR's and things don't usually go 100% according to plan so I want to set a realistic expectation for you.
Those are my initial thoughts. Happy to talk about it in more details if you shoot me a dm.
@Dan Weber that was a really helpful explanation. Thanks Dan. I would want to try and do as much of the work as I could myself. Is that how you operate, or do you hire out to do the rehabs?