Does it make sense to BRRRR a 3,300 sq/ft house?

[Vilena G.]

Hi Biggerpockets family,

We are remodeling complete rehab, which is a big house 3,311 sq/ft, 4 bdr/3bath and a garage. We bought it to flip it, but had been thinking if it make more sense to brrrrrr it, I like brrrrr strategy, but this house is pretty big to find tenants, so maybe it's not a good house for brrrr? It's also our first investment property, so we are newbies!

Would really appreciate your opinions!

Sincerely,

V

[Vilena G.]

Originally posted by @Blake Dailey:

@Vilena G. I think it can definitely still work, your numbers just have to make since to be able to refi and cash flow as a rental after that. With a 3,300sqft your rehab cost will be a lot higher than the median house because there will be more squarefootage that needs work. Run your numbers by finding the all in project cost (including holding costs and any short term lending costs) and the ARV. Then if you can refinance and get most of your money back and it cash flows I would say you could do it. But also weigh the opportunity cost of the cash flow compared to what you could make by flipping. I would rather flip and get my big profit now than cash flow $100 a month when leaving a big chunk of money in the deal due to the size of the project. Just compare your numbers and do what you are comfortable with, but it is doable.

Also, depending on your area, a house with those attributes and size could be in demand a rent high so check your local rental rates to see how your cash flow would be.

Thank you very much Blake! I will check my numbers and make a decision!