All Forum Posts by: Robert Johnson

@Jay Hurst I have it as a $182,500 market value. I would be getting it around $155-160k. Market rent for this unit would be highly competitive at $1700/month, but could push to $1800. So there would be $200-300/month cash flow, with $50k+ in equity right away with 20% down. 

@Jay Hurst this particular deal is one I would be getting instead of listing it as the agent. It's in a good part of town, near our Air Force base and near a growing Ai facility. It would be under market value, and cash flowing (even after allowing for CapEx, vacancy, etc).
I still want to do an inspection just to be sure, but it's looking like a good deal 👌

Hey everyone, I’m looking for some input on financing options and wanted to see what brokers and lenders here recommend. I’ve got the opportunity to buy an off-market property for around $160K. With 20% down, the loan amount would fall under the $150K minimum that most DSCR lenders I’ve come across require. That seems to knock out a lot of the typical DSCR products. To complicate things a bit, my DTI would not qualify me for conventional or personal mortgages, which is why I’m focused on DSCR or other asset-based options. Are there lenders out there with DSCR products below the $150K loan threshold? Or would alternatives like small balance commercial loans, portfolio products, or other creative financing options make more sense for a deal this size? Appreciate any direction or experiences you can share. I’d like to make sure I don’t pass on a good deal just because it doesn’t fit the “standard” DSCR box. Thanks in advance!

Quote from @Deborah Wodell:

I agree with Caleb that BRRRRs hardly ever line up perfectly, but leaving around $15–20k in a deal is still pretty solid given the equity you’ve built in. seasoning can definitely catch people off guard, but there are lenders out there who offer no-seasoning cash-out refis (though you’ll usually pay a higher rate), and some who can refi as early as 3 months in with better terms if the numbers make sense. It’s worth shopping around so you’re not boxed into just one timeline.

From both the investor and broker side, I’d say you’ve still set yourself up for a long-term win here. The cash flow may not blow you away at first, but with appreciation, rent growth, and that equity cushion, this is the kind of deal that pays off down the road. Future projects you’ll just budget a little tighter and stress-test comps, but overall you’re in a good position on this one.

Thanks for the perspective; that's encouraging to hear. I agree, leaving $15–20K in a deal while still holding equity and some cash flow feels like a win, even if it's not the "perfect BRRRR."

The seasoning point is a good one. I’ve heard mixed things about which lenders will actually go for no-seasoning or 3-month refinances, so I’ve been bracing for the longer timeline just to be safe. But it sounds like it’s definitely worth shopping around more so I keep my options open.

Long-term, I’m looking at this deal as a foundational piece; steady equity growth, rent bumps, and a chance to recycle most of my capital. Next projects I’ll just make sure to budget a little tighter and look for a better entry price. 

Out of curiosity, have you personally done a refi inside of that 3-month window, and if so, what kind of terms did you see compared to waiting the full 12 months? 

I posted recently about the impact of the new AI data center on Abilene, Texas, and wanted to follow up with some other data points that are shaping the market.

Rental Inventory
Compared to the broader North Texas region, Abilene’s rental inventory has fallen sharply. In January 2025, DFW sat at about 2.3 months of rental supply, while Abilene had only 1.4. Fast forward to July 2025 and DFW is at 2.4 months, but Abilene is down to just 0.5 months of inventory. Properties are leasing more than twice as fast here; 11 days on market vs. 25 days region-wide.

For-Sale Inventory
Something similar is happening on the sales side. Until early 2025, Abilene’s for-sale inventory moved in lockstep with the larger regional market. Once data center employees began arriving, the numbers split: inventory here tightened while DFW’s kept climbing. That’s showing up in quicker sales and higher demand locally.

Closed Sales
Abilene is also bucking the regional slowdown in transaction volume. In July 2025 we had 214 closed sales, which beat the seasonal peaks of both 2023 (192) and 2024 (182) and nearly matched 2022 (217). Meanwhile, DFW sales have been sliding downward since 2020.

What This Means for Investors

• Rentals are scarce and leasing fast.

• For-sale inventory is tightening.

• Transaction volume is holding strong here while larger markets soften.

It feels like we’re seeing a local market diverge from regional trends, which could be an opportunity for investors looking for stability and growth at a reasonable price point.

Curious to hear what others think: when you see a smaller market bucking regional trends, do you lean in on the momentum or wait to see if things normalize?

Quote from @Caleb Brown:

I would just continue as plan. BRRRs are great but many times they don't go as planned so only leaving 15.7K(worst case) is not the end of the world. You can look at comps to see if there is anything that can boost the ARV but I doubt there is anything that makes sense to do. Future ones maybe be more conservative and you'll know what to expect on the next.

It's certainly a learning experience for budgeting the rehabs. The good thing is that appreciation in Abilene should be higher than the rest of the country over the next few years, so it could turn into a great deal still. 

Quote from @Jay Hurst:

Quote from @Robert Johnson:

I wanted to share a quick update on my current BRRRR project, since the numbers have shifted a bit from what I originally projected. Hoping this breakdown helps someone else and also curious how others handle "not quite perfect" BRRRRs.

So far I’ve spent:

• $11K in closing costs

• $14K in renovations (with another ~$19K of work left)

That could put me at about $44K all-in before refinance if everything stayed on the high side. But realistically, I think I’ll come in under that number once it’s finished.

Potential Outcomes

Here's how the deal looks if I hit the $44K "worst case" and then refinance. For the refi PITI, I'm running a range since rates will impact where it actually lands. For rent, I'm conservatively using $1,500, but there's a chance it comes in closer to $1,600.

Category	Pre-Refi (All Cash In)	Post-Refi (80% LTV, $160K ARV)
Cash Invested	$44,000 (worst case)	$15,750 (after cash-out)
Loan Balance	$99,750	$128,000
Property Value (ARV)	$160,000	$160,000
Equity	$60,250	$32,000
Rent	$1,500–$1,600/month	$1,500–$1,600/month
PITI	$1,050/month	$1,150–$1,250/month (depends on refi rate)
Vacancy (8%)	$120–$128/month	$120–$128/month
CapEx (6%)	$90–$96/month	$90–$96/month
Net Cash Flow	~$234–$334/month	~$34–$234/month
Annual Cash Flow	~$2,808–$4,008	~$408–$2,808
Cash-on-Cash Return (CoC)	~6–9%	~3–17% (depending on rent + rate)

Takeaways

• If I end up at the full $44K worst case, pre-refi CoC sits around 6–9%.

• After refinance, I recycle most of my capital (only ~$15.7K left in the deal) which bumps CoC anywhere from 3% to as high as 17% depending on where rent lands ($1,500 vs $1,600) and what interest rate I get on the refi.

• Even if cash flow is modest at the start, I’ll still be holding ~$32K in equity and a property that benefits (albeit modestly) from appreciation and rent growth in my market.

It's definitely not the "perfect BRRRR" where every dollar comes back out, but I still see this as a long-term win.

Curious how others approach it when you land closer to “worst case” than “best case.” Do you chalk it up to equity and long-term wealth, or do you pivot mid-project to force stronger returns?

Just curious, did you map out the refi strategy on what LTV you can access and on what time line before you started the project?

 I didn't look at specifics for the timeline, but I am estimating 1 year for the rehab, and it's an owner occupied loan. I may refi after the year, but if the rates don't make sense to, then I am also ok with waiting a little longer. 

Quote from @Sultan Ali:

Thanks for sharing the breakdown, Robert really helpful to see the numbers in real time. Even if it's not the "perfect BRRRR," you're still walking away with equity, positive cash flow, and a property that benefits from long-term appreciation. For me, that's still a win. Do you see yourself holding this long term even if cash flow stays on the lower end?

Definitely still a win! I will be keeping it long term, so it is still a good deal. Now I know a little better for the next one. 

I wanted to share a quick update on my current BRRRR project, since the numbers have shifted a bit from what I originally projected. Hoping this breakdown helps someone else and also curious how others handle "not quite perfect" BRRRRs.

Where I Stand

So far I’ve spent:

• $11K in closing costs

• $14K in renovations (with another ~$19K of work left)

That could put me at about $44K all-in before refinance if everything stayed on the high side. But realistically, I think I’ll come in under that number once it’s finished.

Potential Outcomes

Here's how the deal looks if I hit the $44K "worst case" and then refinance. For the refi PITI, I'm running a range since rates will impact where it actually lands. For rent, I'm conservatively using $1,500, but there's a chance it comes in closer to $1,600.

Category	Pre-Refi (All Cash In)	Post-Refi (80% LTV, $160K ARV)
Cash Invested	$44,000 (worst case)	$15,750 (after cash-out)
Loan Balance	$99,750	$128,000
Property Value (ARV)	$160,000	$160,000
Equity	$60,250	$32,000
Rent	$1,500–$1,600/month	$1,500–$1,600/month
PITI	$1,050/month	$1,150–$1,250/month (depends on refi rate)
Vacancy (8%)	$120–$128/month	$120–$128/month
CapEx (6%)	$90–$96/month	$90–$96/month
Net Cash Flow	~$234–$334/month	~$34–$234/month
Annual Cash Flow	~$2,808–$4,008	~$408–$2,808
Cash-on-Cash Return (CoC)	~6–9%	~3–17% (depending on rent + rate)

Takeaways

• If I end up at the full $44K worst case, pre-refi CoC sits around 6–9%.

• After refinance, I recycle most of my capital (only ~$15.7K left in the deal) which bumps CoC anywhere from 3% to as high as 17% depending on where rent lands ($1,500 vs $1,600) and what interest rate I get on the refi.

• Even if cash flow is modest at the start, I’ll still be holding ~$32K in equity and a property that benefits (albeit modestly) from appreciation and rent growth in my market.

It's definitely not the "perfect BRRRR" where every dollar comes back out, but I still see this as a long-term win.

Curious how others approach it when you land closer to “worst case” than “best case.” Do you chalk it up to equity and long-term wealth, or do you pivot mid-project to force stronger returns?

Congrats! Is the new house one that y'all will be doing some value add to? 

I have a lot of work to do to my current live-in brrrr. My goal is to move on to the next property by April of next year. The main difficulty is that the scale of money for this property just isn't very high. I bought it for $105K, with an ARV of $155K, likely with around $20-$25K of work. So when I refinance, I will only get 80% of the value ($125K), which will basically break even on money invested, but will have $30k in equity, and a cash-flowing, well conditioned rental. Though, I am paying for everything as I go along, I will just have the mortgage to payoff, so I will have a lump sum from the refinance to go towards the next deal.