How much rehab is it worth?

[Zack Brent]

Hello everyone,

I will start out by saying that I am only one month or so into learning and being on my real estate journey. I went driving for dollars a couple of weeks ago in Horn Lake, MS (South of Memphis, TN) to look for potential wholesale or BRRR properties. I found a few potential leads, reached out to the owners of the properties after some manual skip tracing, and found a motivated seller.

I know that as long as the numbers work out for you, it really doesn't matter how much you have to spend on rehab or on acquiring the property. However, I am wondering how much profit you personally look for when acquiring a house to BRRR?

Would love to hear your thoughts!

Deal Numbers:

• 3 Bed, 2 Bath -  Approx 1,450 sqft
• Purchase Price: $45,000
• Expected ARV: $115,000
• Rehab Costs: $45,000 - $50,000 (2 holes in roof - somewhat sizeable but covered; moderate gutting of inside will need to be done; plus some landscaping)
  
• Expected Rent: $1,100/month
• Taxes+Insurance: $1,900/year