Is it okay to scale with your own savings?

[Derek Luttrell]

Hi Everyone, 

I was wondering if there were people out there who, as the title suggests, simply scale by using their savings--especially those of us with high incomes, and are able to save much more quickly than the average person. 

I am under contract on my third property since July 2017, and it is the third that is more or less move-in ready. I've never done a reno, and so far have only done things like fresh paint, new window treatments, update appliances, little stuff like that. The numbers are working, and I realize there are better numbers through things like major value-adds and the BRRRR strategy, but is it crazy for someone like me who has saved and deployed $60,000 of my own money on down payments in the past nine months to scale this way?

I don't exactly have time to manage contractors, source materials, etc, and I feel like my time is better used to make sure I continue to excel at my W-2. Is this an unintelligent way to go about this? My goals are cash flow through buy-and-hold. 

[Joe Splitrock]

@Derek Luttrell most people chasing creative strategies are doing so because they don't have enough savings from W2 income. Acquiring two properties a year is a fast pace at your age. The down side of the BRRRR strategy is rehab time = lost rents. I prefer to buy properties that are ready to make money day one. When you spend weeks or months on rehab, the property isn't producing any income. There is an opportunity cost with the BRRRR strategy.

Sometimes BiggerPockets can be an echo chamber. What I mean is the same ideas (like BRRRR) are repeated over and over, so often it becomes "wrong" to suggest anything else. There are many approaches to real estate and trust me, having cash is a good thing.