First brrrr property

[Logan Lehmkuhl]

I currently own 1 single family rental. A friend and I are getting ready to do our first brrrr deal. We have talked with a private money lender and CPA in advance. We are looking to buy a tiny 660 sq foot house as our first one. Being next to a military base rent is in high demand. We also are going to do most if not all the work ourselves. When estimating rehab costs, we came in around 25k which seemed high to me. Does anyone have experience doing their own rehab vs hiring it out? Also the comps in the area are limited due to their not being very many properties that are newly rehabbed or have sold recently. We want to have none of our own money into this deal, pretty positive I can rent for 750/month is that a close estimate to the ARV being 75k based on the 1% rule. Thanks to any who wish to help this young new investor.

[Garrett Christensen]

I do a lot of work myself and have also hired some out. As a very general rule a thumb it's about half the cost when you do it yourself. I'm not sure I understood completely the last bit. It sounds like you're basing the ARV off the 1% rule. Correct me if I'm wrong in that. The ARV should always be done with comps if possible, even if it's using the rent ratio, but never assume you'll hit 1%. In my market, for example, a great deal is only 0.7%. Again, that might not have been what you were saying, so feel free to correct me.