What's the best way to find duplex for BRRRR?

Question

I'm looking into BRRRR strategy and looking into buying my first investment property. I appreciate any advice you might have. My budget is between 500k to 700k for a duplex in northern Jersey. Belleville, Kearny, Harrison, Jersey City etc.....
1- How do the I find the fixer upper properties? How much money do i need for 500k to 700k deal?
2- How do you typically finance the fixer upper purchase? Only hard money lending options available or just depends on the property?

Eliott Elias · Answer

You are asking how to find a property at 70% all in. Target distress, whatever the situation may be. Properties that need a lot of work can typically only be funded by hard money and will have to be refinanced with a DSCR loan.

Eric D. · Answer

What do people think about buying foreclosures at auction? Or trying to get tax lien properties? I have two multi-families that I bought off the MLS in 2017 and 2018, and so it worked out due to price appreciation. But I find it very hard to find properties that produce a good return on investment these days. It seems much easier to just put money in the stock market.

Elaine Dickson · Answer

Does a cash-out DSCR loan follow the new rule (on April 1, 2023) where a cash-out refi has to go 12 months from initial loan date to the refi loan date?

Patrick Drury · Answer

@Henry Ko1- How do I find the fixer-upper properties? Cold call sellers directly or work with an agent that sources off-market deals in the market you are looking to operate. 2- How do you typically finance the fixer-upper purchase? Hard money or cash. Only hard money lending options available or just depends on the property? I am not a lender, but if you want to finance the rehab portion hard money would be what you would use. If the property needs some light cosmetic work and you are willing to fund the rehab out of pocket and it's liveable, you might be able to get a conventional loan/ DSCR loan on it if it qualifies.

Stephanie P. · Answer

Find an REIA meeting or a Meet Up in your area and start talking to investors etc...

Tim Oppelt · Answer

Tim with Carrot here!You can definitely use SEO to find deals like this, but like others have said it does take a long time to see any results. Also, with most inbound marketing methods, its going to be difficult to filter out exact price ranges of properties (500-700k) unless you focus on small areas where all the properties are priced in that range. If you have the ability to wholesale, flip, creative finance, list, etc then getting a wide variety of motivated sellers online is AMAZING! But Im guessing since you have very specific criteria, the most surefire way to find these deals would be direct mail or cold calling. Use propstream to find a list of properties in a given price range and area and skiptrace and call them or send them a postcard or letter. But then you are getting into the marketing business, so it depends on your goals. If you just want to focus on renovations and maintaining rentals, then using wholesalers may be your best bet. If you are in NJ, check out NJRESN its the best real estate meetup group ive seen! google NJ REIA or NJ real estate investor meetup group. check out meetup.com too! There's tons of great ways to wholesalers. I grew up in middlesex county, so hit me up I can connect you with some buyers too! Best of luck!

Steven Goldman · Answer

Hi Henry,  I am a big fan of starting slowly and building momentum as you gain experience. You use a bridge loan to finance your projects. It will require an investment of between 15-20 percent of your purchase price. The funding will be 100 percent of the cost of the rehab. The rehab. should not exceed the purchase price, if it does it will limit your financing options. It will also expose you to more risk as a large rehab job is difficult to execute without previous experience.

Attending real estate meetings will give you access to other investors, rehabbers, wholesalers and lenders. It is a activity that should pay by helping you to learn about your market and the business. Spend your time talking to people and telling them you are looking for rehab. properties. People are your best asset in locating rehab properties. Good luck and keep moving forward.

Bob Stevens · Answer

Simple go to your local RE meetings, they have them,

Good luck

Henry Ko · Answer

Thanks Locus! I'm completely new to investing and my plan is to find a fixer upper, repair it and rent it. I don't really care if i don't take all my money back from the deal after renting. I think duplex make better investment than single family

Andrew Syrios · Answer

There's lots of ways; looking on the MLS, or scrolling Trulia, Craigslist, etc. for FSBP or direct mailing to foreclosures or out of state absentee owners, or probate, etc., go door knocking (although that only works for owners and not so much for duplexes owned by landlords), or SEO (although that usually takes some time to build up). But to find such good deals these that you can BRRRR them (i.e. 75% ARV and hit the DSCR numbers) it is more likely to be direct mail or SEO that would work.

What's the best way to find duplex for BRRRR?

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