4th Property, 3rd BRRRR

[Adri Jusczak]

Investment Info:

Single-family residence private money loan investment.

Purchase price: $45,000
Cash invested: $30,000

This has been my biggest rehab yet! Ran into a few hiccups I wasn't accounting for - repainted the exterior and had the furnace/water heater replaced. Those cut into my rehab budget but will pay off down the road. The rental demand went up so much over the rehab period that I was able to get an extra $100 per month for rent! CoC return of 79%, purchase cap 20%, and a monthly cashflow of $318.

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

The initial price of the home was hard to pass up. I know the market well and knew it would cashflow.

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

It was on the MLS, originally listed for 55k, but was able to negotiate it down after the inspection due to mold.

How did you finance this deal?

I paid cash for the property and used a private money lender to fund the rehab.

How did you add value to the deal?

It needed a new roof, exterior paint, new furnace/water heater, kitchen remodel, switch from fuses to breaker box, exhaust fan in the bathroom, mold removed, new paint throughout.

What was the outcome?

The house appraised for 87k. Purchase cap 20%, CoC 79%, cash flow $318. Not as good as I had originally planned, but still happy with it!

Lessons learned? Challenges?

They previous owner left a bunch of stuff in the basement and garage. That was a major hiccup on my rehab timeline since I had to take a few hours of my limited time to get it out and take it to the dump. As I live in CA and this house is in MN, it was difficult to make sure all was lined up with the short period of time I was there working on it.