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Updated over 4 years ago,
Post BRRR analysis. Am I being too conservative? Killeen, TX
Hello BP community! I hope you are all doing well. I need your input on this property I'm trying to evaluate. This will be my first BRRR so please feel free to butcher my analysis. It would most helpful if you point out my mistakes and I would be grateful for it.
Here is the breakdown for my calculations:
This is a post BRRR. Here is what I figure the refinancing will look like:
Value: $110,000
Principal: $82,500 (75% of the value)
Interest: 4.25%
Years: 30
As you can see, I'm negative on the cash flow. Even in the best-case scenario where I was able to pull out all my money, I'm still losing money while having it rented. Even if I wasn't too conservative, using 50% rule + Mortgage payment, I would only still be cash flowing $200/mo.
For those who have done a lot of these, are these typical numbers or am I being too conservative with my calculations?
Any advice would be helpful. Thank you and stay safe out there.