Updated about 4 years ago on . Most recent reply
Here's the Story of My First BRRR Property
Investment Info:
Single-family residence buy & hold investment in New Smyrna Beach.
Purchase price: $65,000
Cash invested: $22,000
Bought this deal off market in 2019 from a fellow investor using a private money loan for the purchase price and my cash for the renovations. After 6 months I refinanced the property and pulled all of the cash invested back out of the deal plus an additional $6000. The property is currently cash flowing at a great rate and in a rapidly appreciating area.
What made you interested in investing in this type of deal?
Getting my first rental property was a big priority for me and when this deal came along I jumped on it. The numbers were small so it was an easier first step and I knew it would make for a great BRRR property.
How did you find this deal and how did you negotiate it?
A fellow investor brought it to me and wholesaled it to me for a fee. There wasn't much negotiation because the numbers made sense for what I was trying to accomplish. He made money and I got a solid property at a great price.
How did you finance this deal?
A family member had offered to lend the money from a home equity line he had on his home. I made the payments on the loan for him until it was refinanced and paid him 2 points for allowing me to utilize the funds.
How did you add value to the deal?
We did a complete interior renovation including new kitchen, flooring, paint, appliances, and adding a laundry room to the carport area.
What was the outcome?
After refinancing all the cash out I still own the property today. It cash flows about $500 per month after all expenses and because we did a full renovation there are very few repairs needed.
Lessons learned? Challenges?
Go for it. Network with the right people that can bring you deals and also finance them and then utilize your skills and sweat equity to put all the pieces together. The main lesson I learned was to try to do less of the physical work on the rehab because the job slowed down when I got involved and could have been completed faster if I allowed professionals to do the work.
