My first BRRRR - Incline District of Price Hill

My first BRRRR - Incline District of Price Hill

Cincinnati, OH · Member since 2016 · 116 posts · 83 votes

I wanna share a project I've been working on this year. Last year I bought a 3 unit in the Incline District of Price Hill. Was living in LA at the time but after doing some basic research I felt great about the area. With Covid, remote work now being accepted almost everywhere, I moved to Cinci to work on it while still being able to work my regular freelance gigs. Even though I bought it cash, I still got a hard money loan for the rehab. This building needed a ton of rehab and hard money lenders don't like to lend more than the building is worth.. plus I didn't have much experience flipping. I took the loan knowing I would have to invest a ton of my own money in addition to the hard money but when I ran the numbers it seemed with it. Most of the rehab is done by a good crew that I've found after many issues with other contractors. Some basic stuff I do myself like simple plumbing and electrical work.

The breakdown: Purchase 80k

Rehab so far 150k

Hard money drawn so far 60k

Projected total rehab 210k

Rents:

Attic 2 bedroom unit 1k

2nd floor projected rent 1400

1st floor projected rent 1400

At this point the 3rd floor is finished and being rented out. Very strong rental demand, had no issue finding a tenant at the 1k rent price point. 2nd floor is a month away from being finished. Drywall is up but still needs floors, bathroom, kitchen, doors.. I'd love to remodel the 1st floor unit as well, however its already been a year and I had to extend my hard money loan by 3 months. As soon as the 2nd floor is finished I gotta refinance into a long term loan and hopefully I'd get a good chunk of cash back to fund the 1st floor unit rehab.

It's kind of funny.. After looking at these numbers, maybe after its all said and done, for 300k I could just have bought a rehabbed 3 unit in 2020 and not have spent a year working on this.. but maybe not. I didn't really see any buildings cashflowing this well for sale back then but maybe I'm wrong? Anyway I'm really excited about the area, it's changing every day for the better so I know these rents will only go up.

Even though I'm still working on this building, I'm keeping my eyes on Zillow scouring it for the next project. I'm liking East Walnut Hills or northern OTR.

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Real Estate Agent · Cincinnati, OH · Member since 2015 · 474 posts · 580 votes
4y

@Timur Salikov Sounds like an exciting project. I do large renovation projects as well here in Cincinnati. I agree with your mentality, they are very frustrating, take a long time, have a lot of risk and holding costs, and you have a lot of hoops to jump through when doing major renovation projects. They can certainly be rewarding as BRRRR deals. I have had a few where I pulled all of my capital out plus profit, and still cash flowed well. However, after doing BRRRR deals for the past 5 years, I am at a point where I am willing to take a lower return on an easier deal going forward. I hope the remainder of your project goes quickly and smooth. If you need anything reach out, thanks!

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  • Real Estate Agent · Cincinnati, OH · Member since 2015 · 474 posts · 580 votes
    4y

    @Timur Salikov Sounds like an exciting project. I do large renovation projects as well here in Cincinnati. I agree with your mentality, they are very frustrating, take a long time, have a lot of risk and holding costs, and you have a lot of hoops to jump through when doing major renovation projects. They can certainly be rewarding as BRRRR deals. I have had a few where I pulled all of my capital out plus profit, and still cash flowed well. However, after doing BRRRR deals for the past 5 years, I am at a point where I am willing to take a lower return on an easier deal going forward. I hope the remainder of your project goes quickly and smooth. If you need anything reach out, thanks!

  • Member since 2021 · 13 posts · 8 votes
    4y

    @Timur Salikov this looks awesome! It does look like a lot of work but congrats!

  • New to Real Estate · Los Angeles, CA · Member since 2020 · 34 posts · 52 votes
    4y

    The project looks great so far @Timur Salikov!

    What would you say are your top 3 learnings from this project (so far)?

  • Cincinnati, OH · Member since 2016 · 116 posts · 83 votes
    4y

    Hmm I would say.. 1. Contractors are super busy now, expect your remodel to take much longer 2. Houses are cheap here but labor is not, so only buy and rehab houses that are worth the investment 3. Shop around, for example I got quotes to remove a loadbearing wall from 10k to $700. 

  • Joseph PostPro Member
    Member since 2020 · 5 posts · 2 votes
    4y

    Congratulations on your first BRRRR deal. Looks like a beautiful property! Alot of time, hard work and lessons learned. A win win situation. A great investment property and helping the rejuvenation of the community. Good luck on the continuing of your BRRRR deals.

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