Should I buy a 20% cap rate portfolio or by 1 by 1 BRRR cash

[Gary Garcia]

Should I buy the portfolio or use the cash to buy 1 property cash and start BRRRR from there one at a time? I'm in CA so this will be out of state. I've found the best PM who manages projects and has a great contractor for the portfolio. The rentals are bringing in 20% cap rates but the purchase price is about market value already. They are 100% occupied with no rehab required. I've read the BP: BRRRR book but doesn't really answer this scenarios question. Send HELP

[Nick Robinson]

@Gary Garcia

I’ll just echo what everyone else has said I would do your own numbers and make sure expenses are included.

Example first property

$600/mo.

$7,200/yr

- 50% expenses

$3,600 NOI

$29,500 purchase price

Cap rate = 12.2%

Since you are not managing the deal you have to minus another $720/yr

$2,880/yr CoCr

$240/mo

that’s a 9.76% CoCr