Here is the play I run over and over in Memphis, and the numbers are why it works.

I buy single-family houses under $100K, usually a 2-bed, 1-bath. A 2BR rents for less and sits longer. A 3BR hits the Section 8 rent band and the 1% rule much easier.

So I convert it. 2/1 to 3/1 is the main play. I also do 3/1 to 3/2, 3/1 to 4/2, and 2/1 to 4/2 when the layout allows it. Most of the time I am adding about 400-650 sq ft, often by converting a carport or garage into a master bedroom and bath. That extra bedroom is what changes the rent and the value.

The math I target: buy under $100K, ARV $180K-$265K, Section 8 rent $1,395-$1,950 for 3BR and up. That is the band I underwrite to in Memphis ZIPs 38109, 38111, 38112, 38114, 38116, 38117, 38118, 38122, and 38128.

I run this as BRRRR. Buy it right, rehab it to add the bedroom and bath, rent it on Section 8, then refinance. I have done this across 236 properties, and deal flow is still the bottleneck, not the rehab. I also never put earnest money down. If the numbers do not work on paper before I start, I do not start.

It is not fancy. It is buy low, add a bedroom, rent it in the right band, and repeat.

What is the one conversion or addition that moved the rent most on a deal you have done?