3 Year BRRRR Testimony

[Brian Tome]

We bought this little 2 bedroom 1 bath cottage in Elkton, Maryland for $45K in 2018. It was in need of a complete rehab and we put another $80K into it before renting it to a nice young lady in January 2019. After renovation value was appraised at $147K on January 4, 2019. Our tenant takes excellent care of the property and it has cash flowed around $100/month (on a 15 year note with a 10% reserve) since then.

On the refinance we were not able to get all our money back out. We left about $15K in the deal, which we considered a failure at the time (I was hung up on the idea of getting everything back out). However, cash flowing $100/mo. it still produced an 8% return on investment, so we kept it and tried to do better on the next one.

Fast forward three years and this little cottage just appraised for $210K. After we refinance and put it on a 30 year note, it will cash flow about $300/month (without raising the rent once), put $57K cash in our pocket (to reinvest), and we will still have $53K in equity in a property that we originally invested $15K into - not to mention the tax benefits we gain from depreciation.

This is why I love real estate. It isn't easy or risk free, but it has been a blessing to us.

If you are in the Maryland, Delaware, Pennsylvania area, reach out so we can talk.  These deals are plentiful around the I-95 corridor through the tristate area.