Baby's first Brrr - give it to me straight

[Christen G.]

Hey folks,

I'm new here. I have a few properties in Washington State and am looking for more. I have next to no skills in handy-work to say the least and I'm not particularly interested in learning. Give it to me straight: how hard is a BRRR? Should I just budget for contractors and hope for the best? Any advice welcome and thanks in advance.

[Ben Wilkins]

@Christen G. - since this is your first rehab, I have a few suggestions as far as "how scared" and "hope for the best"

1. Go to your local REI meeting. They can usually be found on Meetup.com, or through BP

2. Talk with some people at the REI meeting who have done flips. They will have local contractors, financing, etc that they trust.

3. Either offer to shadow one of the local flippers in order to gain experience, or skip this step and go to #4 (depends on your comfort)

4. Find a property, and have one of the contractors from #2 walk the property with you. They will be able to give you an estimate of work that is needed, costs, etc

5. Start analyzing properties for numbers / profit / costs. Use the contractors' estimates for rehab costs (plus maybe a 5% or 10% contingency cost). The "general rule" is to find a property that will cost 70% of ARV when you add the purchase plus the rehab. Your area will determine if 70% is your target, but you definitely want to be below 100% ;)

6. Purchase the two books that are sold on BP or on Amazon: Flipping and Rehabbing

7. Finally, purchase a property and start the work.

These steps will give you knowledge, help you find other experienced investors who may give you a chance at gaining experience, help you learn which contractors are trusted by fellow investors, etc.

Don't be scared - if you have some knowledge, if you have the quotes, and if you understand the scope of work before you invest, it isn't something that should keep you up at night.

Don't just "hope for the best" - find a trusted contractor, build your own relationship with them on your first project, and go into the project with their walk through and quote prior to making the purchase. This will ensure that you go in with a plan and an understanding of your budget, rather than a shot in the dark mentality.

Hope that helps! If you want some BP members to help look over numbers, find a property and post the details (purchase price, estimated rehab, estimated ARV, local comp sales, average rent in the area). With those details, we can help add some confidence for your first purchase.