Rental Property Investor 路 Charlotte, NC 路 Member since 2019 路 38 posts 路 48 votes
I received a deal from a wholesaler on BiggerPockets (I gave a reference to the wholesaler). This is a single family home located in Wilmington, NC. The deal was $80K for a 2 bed / 2 bath 1140 sqft property. It has renters paying $1,000 / month. The renovation is estimated between $20K - 35K for ARV of $140K. This is a cash purchase for me using my funds from a Solo 401K. The closing will be next week. I will post my BRRRR calculations once we close on the property.
Is this a flip or buy and hold? If it's a buy and hold, how much will it rent for after rehab?
We have been discussing a property that a member was going to get for purchase + rehab 92k, ARV 130k and rent for 995/mo. Numbers not too different from yours. Consensus was that it was better for a flip. Check it out.
I am planning on buy and hold at the moment. The place already has tenants that want to stay, and the cash flow is good, so we may wait to rehab it until after the tenants decide to leave. what we are going to do is still fluid at this point. I will know more once it closes and we can meet and talk to the tenants. I would like to do the rehab, but it is working as is. We still need to find a contractor that can do the work as well as provide a quote for the rehab work. I will check out the other post.
I closed on the Wilmington property on Friday. There were some last minute hiccups, but we were able to get everything straightened out. We allowed the owner to stay one month so he can move, and we have tenants already renting with the owner, so we will not receive any rent until October 1st. Now do we rehab the place or not. We cannot rehab with tenants. I think we will see how the tenants are for a month or two before making that decision. I guess I'm not really doing the BRRRR method. Instead I am doing a buy and hold rental. I have been looking at the non-recourse loan options out there, and the costs of doing these (which is required because of the solo-401k) are not very good. Most of the fixed rate plans I am seeing range from 50% to 60% LTV with an interest of 7% and higher.
@Anthony Smoke, Man you are a beast! And everyone says you can't buy cash flowing deals in Wilmington, NC. Anthony walks in and buys one in one week. Good stuff!
@Anthony Smoke Nice! Keep me posted. I'm currently in the middle of a rehab in Wilmington as well. Plan is to BRRRR the home. Added sq footage, a BR and bath, as well as a studio apartment on the second floor. Definitely interested in talking to anyone buying in Wilmington NC. Also be safe if this storm hits.
@Anthony Smoke Congrats! As you mentioned, the BRRR strategy may not be ideal in a SOLO 401K. Still a great way to learn and its more fulfilling to drive by your retirement vs. watching the stock market.
@Sandy Sciales - Hello Sandy, the closing attorney was Moore Law, but I don't think I would recommend them. The house had a foreclosure being issued against it, and they missed it. My wife is an expert on mortgages, and she sent back the Statement of Settlement Cost back to them about 7 times before they got it right.
@Bob Anthes - Yes, I will update here any updates. Can you recommend a contractor to help with the rehab?
@Account Closed - It will increase about $400 per month, but after reading the NC Codes, I may need to bring the unit up to the building codes. I know there are some minor rehab that needs to be done.