To Flip or to BRRRR?

[Justin Melendez]

Hello BP Fam,

I am about half way into the rehab of my first deal and wanted to reach out to the community and gather some opinions. Before I get into the numbers, I will say that my long-term investment goal (the why) is to gain passive income through long-term buy-and-hold rental properties in order to supplement a military pension in ~10 years. I am open to flipping houses to raise capital to put towards more/better long-term buy-and-holds. 

The current property I am working on technically works for both a flip and a BRRRR, although it has less than desirable cash flow in a less than desirable (for me anyways) class C neighborhood. There are a few things that give me pause for BRRRR'ing this house: cash flow, tenant base, neighborhood. The HUD was built to support delayed financing in the event I decide to go that route, thanks to @Alexander Felice for sharing his deals! Part of me just wants to flip it, add an extra ~$10-$15k to my working capital and move towards a small residential multifamily property for a better cash-flowing BRRRR. Please let me know what you think, here are the numbers and BP Calculator snippets. 

Purchase Price: $35,000

Renovation: $43,725 (includes 10% overage) 

ARV: $105,000 (Will likely list for $110,000 comps support it)

Rent Prices: $900

BRRRR

FLIP

[Alexander Felice]

hard to say

I'll tell you this, you're in this house for more than I'm in any of mine that rent for the same amount....

Ask yourself how easily you can replicate this property, the easier you can replace it the more you should lean towards flip, the more limited inventory is the more you should lean towards hold.