Taking a 5 Unit to a 4 Unit

[Rick Albert]

Hello All,

I'm looking at a 5 unit to BRRRR. They are all 1 bed/1 bath. I'm thinking of downsizing it and combining two of the units to where it might at least a 2/2 but maybe a 3/2. I thinking of this for the following:

1. Better unit mix (I know the total rents would be lower but for resale)

2. Better financing (don't need to go the commercial loan route)

3. Don't need an LLC, which adds to the cost (for now since everything is in a trust and I have an umbrella policy for liability, eventually I will get an LLC where I can spread the costs out)

I wanted to get everyone's thoughts on this. The plan is buy cash and then refi after the work.

Thanks!