Finishing rehab / rent #7 for the year, leaving a lot of money behind

[Rick Bassett]

We bought, rehabbed and rented 7 SFH's this year, which is by far our most productive year in RE. We have it down now to where we can do a pretty full rehab in 30 - 45 days.

I didn't expect that we would do so many this year as our problem has historically been finding deals that make financial sense but we are now getting a steady stream of property (and tenant) referrals from our growing network.

We typically buy our properties for cash in the $140 - $160k range and put in $20 - $50k so that we can: 1) Command a higher rent and 2) Have them mostly ready to sell if/when the market pops. We refinance the properties after they are renovated and rented. The refi's usually cover close to our purchase price (70% LTV) but not the renovations.

The big down side that we are running into is the cumulative renovation money that we are leaving behind in each of the properties. We have been funding the renovations from (dwindling) personal funds and cash flow. My hope is to get to a point where cash flow covers renovation costs and that we can stop hitting our personal funds.

Any words of wisdom would be appreciated.

Rick