Houston BRRRR-ers - any success with finding properties?

Question

Good afternoon fellow investors,

With Brandon Turner's faith in and success with the BRRRR strategy, I'm quite sure I am one of many in the Houston area considering taking the same approach to acquiring more properties. However, being willing to try it and being ABLE to pull it off are different. My main question is this - for those who have SUCCESSFULLY done so, how did you find your deal?

I certainly do not expect people to share the name or their wholesaler, but I would like to know where to focus my energy and time.

*Did you meet your wholesaler at a networking event?

*Did you find your properties on Craigslist?

*Did you drive for dollars?

*Did you find your deal on the MLS?

*Did you do your own direct marketing? (I REALLY do not want to do this)

Like many of you, I get tons of emails everyday containing properties with over-inflated ARVs and underestimated rehab budgets that come nowhere near the ideal numbers for BRRRR.  So, if majority of people did not come across their properties until getting out there and networking regularly, then I'll up my efforts to attend networking events. I just want to narrow down my approach and get moving in getting more properties!

Thanking everyone in advance for their responses! I so appreciate the BP community.

William E. · Answer

@Denise Mayo-Walley

• I've found 1 house in south houston at an auction @$35k + 25K rehab.. sold $120k 

held 5 years
• held 5 years
• 1 house near hobby airport from a friends relative that passed away @ 50k+15k rehab.. sold 160K

held 5 years
• held 5 years
• 1 house on mls inner loop houston 90k +20k rehab sold 250K

held 10 years
• held 10 years
• I Just bought a house on mls in legue city a few weeks ago for 125k +50 rehab (currently in process) ARV 250k

plan on holding a few years
• plan on holding a few years
• just put an option on a house being built in Pagosa Springs, Colorado that i'll be using as a vrbo @450k - proforma and rental rates appear to be amazing.

• held 5 years

• held 10 years

• plan on holding a few years

i'm not yet a wealthy guy, but i'm trying to get there.

• I have talked with many whole sellers and investigated many properties, but i have not yet had them bring me a 'deal'.
• I also have a direct mail campaign going on and get the occasional call, but also i have yet to get a deal from here. 
• I have checked out portfolios of 'off mls' deals from realtors that know other investors. these are also not 'deals'.

i'm a part time investor and have been for a long time, but this year i'm trying to get more involved, although i think I've tapped myself out as far as my personal expenses on this VRBO opportunity. it will force me to find other investors to partner with.

Nikolas Ferreira · Answer

we had to find our own deals in order for the numbers to work for us. as with the cost of Hardmoney it makes it a lot harder to make any deals work that are coming from "big wholesalers"

and as far as direct marketing i use a company that does it for me, you can be as involved as you like or not at all, in the wholesale process, regardless if you want to keep the properties or just wholesale them out to someone else.

Regards,Nick

Raul Flores · Answer

@Denise Mayo-Walley, I know is a good strategy, I will try to get 75% after 6 months of ownership.

Vijaianand Thirunageswaram · Answer

@Denise Mayo-Walley  You are absolutely right about over inflated ARV, underestimated repairs and way too high margin on the wholesaler deals. When you go check out the property, it's totally upside down than what they told you. You put the numbers, you are not even close to 5% Cashflow or return. As a realtor, I sometimes get better deals over cautiously looking at MLS than wholesale deal.  For example, I got wholesale deal for property in Missouri city for $100k with 20k rehab and ARV was projected for $155K. When I did the numbers, ARV is just close to $130k. I even found better property for $105k with same rental income.

What I am trying to say, you cannot only depend on one source. You gotta to be watching out and analysis everything it comes to you. You will become expert on analyzing and don't have to spend too much time afterwards like Brandon says. Then it's easy to quickly spot the deal and move on.

Don't give up on wholesalers, don't give up on MLS, keep networking in events and make contacts. Sometimes good deals takes time. Don't give up...

Side note, I did get your message asking for private company or something. There are few out there whom you can put your money and forget about it. Sometimes you even can act as private lender and make better money if you want to take risk.. It's all up there.

Anthony Ellison · Answer

following this ... Would like to see what others say.

Denise Mayo-Walley · Answer

@Raul Flores- from what I've read here on BP, the percentage of ARV you will be able to get during the refinance depends on both the lender you choose and the seasoning period. Different lenders have different terms. It appears that the longer you hold the property before refinancing, the greater the percentage of ARV you can get financed. If anyone else gets a different impression, please feel free to chime in.

BRRRR is a great strategy, and for those of us looking to use it, we're going to need to learn from each other. Good luck everyone!

Christopher Bowie · Answer

@Raul Flores I was seriously looking a the mobile home market in Tomball/Magnolia areas.  Kinda got busy and let it slip.  I would like to start looking again.

Also very interested in this thread.  I'm new to investing and am trying to learn as much as possible!

Judson Heartsill · Answer

Hi @Denise Mayo-Walley, I'll send you a PM

Raul Flores · Answer

I just finish fixing my first property, and also I found the second property, my surprise with BRRRR is that I only get 70% on fixed loan for the cost of the property after ARV, mean I do not have the loan in base of the market price.

So eventually I will run out of money I can get from BRRRR.

Also I am planning to begin my own marketing for mobile homes, anybody doing it?

Ron Sicoli · Answer

@Nikolas Ferreira  would be interested in knowing what company you use for direct marketing as well.

Houston BRRRR-ers - any success with finding properties?

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