Time to BRRR Refinance?

[Pete Harper]

I wanted to get some opinions if now is a good time to Refinance a BRRR 4-plex. I purchased a 4-plex for $257,000 all cash September 2019. We put an additional $15,000 into rehab so all in cost $272,000. The units are all fully rented generating $2940/month gross rent. Tenants pay all utilities.

I can now refinance to pull my equity out for the next deal. ARV is $271,000 to $280,000. I have financing for 75% LTV, 3.875% 30yr fixed, so I can pull out $203,000 with a $954.58/month payment. After financing CoC is 14.6% cap rate is still 7.8% plus I can take the $203k and buy another 4-plex.

Is now the time to pull the trigger on low interest rates and buy another property or wait and see? Despite Covid rents seem to be stable in my market. I’ve managed to collect all rents plus fill the vacant units we rehabbed. Prices have come down slightly.