Does Brrrr Method work in all markets? North Jersey

[Michael O.]

Hello Bp!

I guess this will be an introduction and also a question.

Little about me:

I have been lurking around this website for months reading forums, webinars, podcasts, etc. and it has been very helpful. I do have a strong entrepreneurial background, I am the owner of a textile company in a very niche 30m market. We have two warehouses with about 40 employees and in the past 5 years we have become the biggest player in this space.

1).As for my real estate experience, it's a bit limited, although more then most starting out. I have a townhouse that was pretty much a turnkey investment traditional money down and it cash flows about 300 dollars a month but only because I put more then 30% as a down payment. 

2). Bought a 32,000 sqf office/warehouse space back 11 years ago. This was a better deal, I didn't know it at the time but he was a "motivated seller". It will be paid off in 4 years and the net cash flow with be 27k a month!

3). My wife and I wanted to purchase our first home 3 years ago however, we could not find anything that fit the bill even over the 1m mark. So we decided to purchase a house in a area we liked and build a new house. When working with a realtor and nothing came available after months of searching, I decided to take action. I made hand written notes and put it in neighborhoods in which we wanted to build. Wouldn't you know it? got a seller with the first batch I put out. 62 year old couple was getting divorced and wanted to sell. Looking back I pretty much paid retail price for it, but wasn't thinking like an investor. 

Ok enough of my background.

So as the title says I want to use the Brrrr method to acquire homes and rent them out for positive cash flow. I set a marketing budget to 2k a month for the next 6 months. I have formed a list of the type of people that would be motivated sellers and some where I saw property that looked like they were not taken care of. 

So last week I had dinner with a friend who's whole family is in real estate. They as a family, own one of the largest brokerages in the state. So I laid out my plan and he pretty much said it's not possible or going to be very difficult. DREAMS CRUSHED! 

Now, I live in a very expensive and highly competitive part of the country. I watch these podcasts where people buy a dozen homes a year using this method but usually in markets that are not quite as expensive or competitive. I paid 450k for a house that I was just going to knock down for an example.

So, I would love to hear from my fellow Jersey people or anyone that as a comparable market that this is possible and my realtor buddy was incorrect. 

Thanks,