Advice on Analyzing Deal BRRRR or Flip

[Holly Lucas]

We purchased our first rental last year and are looking to scale up this year. In doing so, I am analyzing a property for a potential BRRRR and/or flip. Property was owned by a hoarder (shockingly enough the property doesn't smell bad and is in good condition...just needs a deep clean).

Monthly Income (including utilities) $1,125

Monthly Expenses (including utilities and loan) $850

Monthly Cash Flow $275

Cash on Cash ROI 24%

We already have tenants lined up who can live in the property for at least one year at the rental income stated above. We are considering a flip after one year given the current market values of properties in the area are selling for around $110,000. The purchase price for this property is $58,000 and rehab costs will be $8-10,000. 

Interested in advice on maintaining the property as a rental vs. flipping after one-year. The one-year time period will allow us to minimize the holding costs and, if I understand correctly, avoid the capital gains tax.

Thanks in advance!