BRRR Deal Executed and Resold

[Cassidy Burns]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $50,000
Cash invested: $25,850
Sale price: $112,846

BRRRR Deal Executed and now turning into a 1031 exchange! Lets take a look at the numbers

Original Purchase: May 16, 2018
-Purchase Price: $50,000
-Closing Costs: 2,700
-Rehab Costs: $10,650
Total All In Cost: $63,350

How I Financed Originally:
-25% Down Commercial Financing ($12,500 down)
-$37,500 Loan Amount - 5/1 ARM amortized over 20 years
-5.25% Interest Rate
-Monthly Payment: $365/month

Refinance Period:
-Refinanced following completion of construction 4 months later

New Loan: October 2018
-Appraised Value: $94,500
-New Loan: $67,500
-Closing Costs: $1,500
-6.29% Interest Rate - 5/1 ARM 20 Year Amortization
-New Payment: $692/month

I was able to take all of my original money out of the deal and pay myself a small $4,250 tax free payment "Just Because 😏 "
I now have $0 in the deal

Current Rents: $1,049/month
Current Cash Flow After Refi: $357/month

Resale Date: December 2021
-Sale Price: $112,846
-Current Loan Amount: $55,422
-Closing Costs: $3,350.92
-Commissions: $6,635.34

Total Net Profit: $46,123.64

I"ll now be doing a 1031 exchange and rolling that into a longer term multifamily building. Now that is how you execute the BRRRR strategy.

What made you interested in investing in this type of deal?

Ability to take my cash out after 4 months while still cash flowing

How did you find this deal and how did you negotiate it?

Realtor.com.. Used realtor to negotiate it, came in $15000 below asking price

How did you finance this deal?

Bank Financing.

How did you add value to the deal?

Slight Rehab and getting property tenanted.

What was the outcome?

Success

Lessons learned? Challenges?

Time IN the market is better than TIMING the market