BRRRR - Buy, Rehab, Rent, Refinance, Repeat
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Updated over 2 years ago,
Alternative analysis of BRRR vs sale?
Does anyone have an alternative way of calculating the value of a BRRRR in terms of future income - present value? Annuity, perpetuity, zero-coupon bond with a speculated maturity value? What I'm trying to solve is finding a present value baseline to compare the BRRRR'ing a property vs selling. Am I overthinking this? Does anybody have a simpler way of comparing the two scenarios?
Specifically, I'm in for $230k on a property that will need another $60k to finish renovating. Once completed, I can cash flow without refinancing, around $22k annually. If rates drop I can refi cash out...dependant on rates. A neighbor has given me an unsolicited offer (no $ amount mentioned) to buy the house so they can level it and improve their property value. I'm trying to analyze what the property is worth to me, in order to sell it?
Thank you!