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Real Estate Deal Analysis & Advice

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Jeremie Torres
  • Rental Property Investor
  • Baltimore, MD
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51
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Deal Analysis Practice Question

Jeremie Torres
  • Rental Property Investor
  • Baltimore, MD
Posted Aug 3 2020, 15:53

This is a practice deal analysis for BRRRR.
Subject property = 50k. 
Rehab estimate with 25% overrun = 31250.
Closing cost = 1500
Purchase cost, cash = 82750.
My ARV calculation = 151632.

After refinancing, how did I become upside down of -$26,085?

I played around with the numbers and I only change the purchase price to 100k then that's where it gave me a positive outcome after refinancing:

It doesn't make sense that I have to purchase the house 50k more than it's asking for just so I can be on a positive side of things when it comes down to refinancing.

Can someone explain what I'm doing wrong, please?
I already appreciate you're reading this.
Thank you.

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