Anyone successfully doing long-distance BRRRRing in Pittsburgh?

[Jim K.]

Just trying to keep it real here. I know one outfit doing well near me, and I'm not sure where the money is coming from, but the tradesmen involved are just about as local as you can get. Does anyone know of a single investor successfully pulling off a string of BRRRRs in Allegheny County and living somewhere else? Built a team out of their Core Four, followed the best advice, making it happen? Anyone? Because the more I look at it, and the more people contact me here trying to get me to run point on their projects, the less plausible it seems to me, and I would like to talk to such a person over a McRib or two, and learn their mighty secrets.

[Anthony Angotti]

Quote from @Jim K.:

Just trying to keep it real here. I know one outfit doing well near me, and I'm not sure where the money is coming from, but the tradesmen involved are just about as local as you can get. Does anyone know of a single investor successfully pulling off a string of BRRRRs in Allegheny County and living somewhere else? Built a team out of their Core Four, followed the best advice, making it happen? Anyone? Because the more I look at it, and the more people contact me here trying to get me to run point on their projects, the less plausible it seems to me, and I would like to talk to such a person over a McRib or two, and learn their mighty secrets.

 Yea, however not with the EXPECTATION that they will pull out 100% of the cash after only a year. Over the past nearly 10 years I’ve talked to what feels like hundreds of people interested in investing in Pittsburgh. Of those people I’ve ended up working with maybe 1/25. I normally tell customers that you can pull cash out but that you’ll end up leaving some in either because you got an unpredictable appraisal OR because you can’t pull 100% of the cash out and expect to have enough cash flow/buffer in your budget to pay for the full value cash out loan payment. Usually the latter. Or you can wait 3-5 years and as long as values go up refinance then. 

I tell people up front that the BRRRR strategy is a great thing to keep in mind and a great thing to aspire too, but I've found it to be all sizzle and no steak and to be honest it bothers me how much it is pitched by online sites and seminars and all that. It sets unrealistic expectations that you can execute it as a newbie from anywhere with not much cash, and because I'm honest about that I see a lot of investors go to other agents to buy houses that when I see what they bought I know it doesn't work (see their posts on FB forums usually asking for advice because they are having problems with the $30,000 house they bought in a bad area and their property manager/contractor/etc won't give champagne service for sparkling water prices).

The internet tries to sell the get rich quick idea, stack and stack and stack, and it’s easy to see why. Because selling the real estate dream makes money fast, not actually living it. 

After almost 10 years of investing I’ve built a nice little portfolio for myself that sometime in the next couple years should pay off ok. I’ve done a little bit of BRRRR, a little bit of house hacking, a little bit of traditional buy and hold, but think about that. I’m local, I do this full time, I have worked really hard at it, I have my own staff, I have had to deal with a lot of drama/stressful situations in my time, AND I really only invest in B class neighborhoods and it’s just NOW getting to the point where it’s starting to pay off. After almost 10 years of really having real estate be my main focus.
Buy and hold real estate is one of the few ways an average person can actually live out the American dream still. Work hard, live frugally, invest wisely, and eventually with enough time you can jump a socioeconomic tier, but it doesn’t happen quick, and it doesn’t happen for free, and it’s really hard. None of what I said should be discouraging per se, but anyone new and reading should take it more as a disclaimer. Rental real estate as a small player will long term make you a richer person if you do it wisely, but it’s a long path, with a lot of big and small problems to solve. And I can guarantee that you won’t do it in 3 years by BRRRRing every property perfectly. That shift in the expectations of the community is a big part of why I don’t post on BP as much as I used to, because as the economy went up and some of these strategies that I knew weren’t viable long term became more and more popular too many threads turned into hard eye rolls. So I just got kind of tired of it. Trying to be back on BP more because I got so much value from it when I was starting, but I agree that where the marketing for real estate investing has gone feels somewhat disingenuous.