The BRRRR Strategy Is Dead???
The BRRRR strategy is dead...
At least that's what I keep hearing, but is it true?
The BRRRR strategy has been a popular method to buy houses with little to no money out of pocket.
Nearly every single-family rental property I've owned was bought using BRRRR.
So what changed that would have people say that the BRRRR strategy is dead?
Home Prices: Home prices have been growing much faster than rent growth, making it harder to find properties that can be bought at a low enough price to cash flow
Mortgage Rates: There has been a sharp spike in mortgage rates, which significantly impacts cash flow
But, is this really the end for BRRRR? Not necessarily!
Sure, it's more difficult to find low or no money down deals in this market that will cash flow, but that doesn't mean that BRRRR is dead.
It means that you may need to adjust your expectations and become more selective in your investment criteria.
A few things you can consider include:
Invest in markets with lower median home prices
Creative financing: seller financing or subject-to
Add more value to demand more rent: short-term or medium term rentals, fully-furnished rentals, unique experience vacation rentals
The fundamentals of BRRRR work in any market.
Creative and adaptable investors don't make excuses. They make deals!
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