Northeast Ohio BRRRR Complete!
Hello BiggerPockets community!
Wanted to share the details of our most recent BRRRR project in Cuyahoga Falls, OH (just north of Akron). We purchased this property off the MLS as a 2 bed/1 bath for $55,500. Total renovation (including closing costs) came in around $46,000 and took 3 months. The bulk of the renovation consisted of foundation repair, and costs to access the attic space in order to add a master suite. We now have a 3 bed/2 bath with estimated ARV at $140,000. A few before/after shots:
We are waiting on the cash-out refinance to close, which will give us $96,000, so we will be leaving about $5,200 in the house due to the bank's appraisal coming in a bit lower than expected. This is the first time we've ever had an issue with an appraisal; in reviewing the appraiser's four "comparable" sales, two of the properties were only 3bed/1bath homes, and the other two were un-renovated 3/2 homes that sold almost a full year ago. I'm disappointed, as there were at least 4 much more comparable sales within the past 3 months that would have given us the value we needed, but perhaps we just got stuck with a lazy appraiser this time around. In any case, leaving $5,200 isn't bad enough to refute the appraisal, so we are moving onward. Detailed renovation costs and rental numbers posted below:
| Item | Cost |
| Demo (includes removing kitchen wall & installing support beam) | $1,500 |
| Exterior paint & siding repair/replacement as needed | $4,500 |
| Roof repair | $350 |
| Foundation repair/basement waterproofing | $6,200 |
| Renovate existing bath (new tub & fixtures) | $975 |
| Build new staircase to access attic | $3,600 |
| Finish attic space (reinforce joists; install subfloor; insulate; install windows; framing; electric; drywall; add bathroom) | $19,500 |
| HVAC | $2,000 |
| Tile tub surrounds in both baths* | $600 |
| Electric (new fixtures/outlets/switches)* | $400 |
| Interior paint* | $800 |
| Flooring* | $1,900 |
| Misc carpentry (trim work, shiplap, floating shelves, etc.)* | $575 |
| Misc (landscaping, kitchen faucet, door & cabinet hardware, drywall repair, smoke detectors, etc.)* | $600 |
| Utility costs during rehab | $200 |
| Closing Costs | $2,000 |
| TOTAL | $45,700 |
| *DIY jobs; cost listed is for materials only |
We have almost a dozen showings lined up this week after just a few days on the market, and hope to have a tenant selected over the weekend. Here are the rental projections:
Rent: $1,200/mo
Taxes: $1,600
Insurance: $625
Maintenance & Capex: $1,500
Vacancy: $720
Yearly Expenses: $4,445
Debt service: $625/mo
Net Income: $2,455
Cost basis: $5,200
Cash on cash return: 47%