All Forum Posts by: Dan Falcon

@Scott Gaspar there it is! 

Just a lesson learned, my PM had suggested we market at 900/month and I may have been a little greedy so I asked him to start at 950. We ended up with a bunch of showings and no bites. We lowered the rent to 900 and had a renter in there really quickly. My PM also charges a monthly fee for dogs (dependent on size and quantity) so we were able to tack an extra $30/month on there for a total rent of 930. 

@Scott Rogers I am trying to upload pictures! For some reason it’s not working with me. 

Home is from the early 1970s. We went with a basic level of rehab. Crisp, clean and fresh. New appliances and flooring in the kitchen. Painted cabinets white and installed an inexpensive countertop.  The rest of the home had wood flooring which we brought back to life. New coat of paint inside the home and new ceiling fans. 

For Fayetteville there’s no value in over improving. We strive to deliver a safe, clean & affordable home that a family can be comfortable in. 

@Justin Tahilramani thank you! this is a different Deal 👌. First one on rockfish road equity spread was much larger. This deals cash flow is greater. 

I will add photos at a later time. Tried to upload jpeg with chrome and IE but no luck! 

Hi there, hope all of you doing BRRRR find this useful! This property is located on Dumfries Drive in Fayetteville NC. The home is a 3/2. I included a few before and afters. Unfortunately I financed at 5.25% right before rates took a sharp drop into the 4.8% range, which stinks, but I am still confident in the end result.

Purchase Price - 42000.00

Repairs & Various HUD items - 18000.00

All in - 60000.00

ARV - 81500.00

Property is rented for $930/month 

5% Vacancy - (46.50)

Property Tax - (68.75)

Insurance - (72.08)

10% PM - (93.00)

CapEX - (100.00)

5.25% @ 30 Years Fixed - (331.00)       

Cash Flow - $223.00/Month 

Equity - $21500.00 

@Bryant Tumbelekis was my realtor on this one. Definitely reach out if you are looking for a professional. 

@Account Closed so let me be the one to say it, for your first BRRRR deal, nice job! You have created over 45k in equity & have a property that cashflows north of $140. Also a little cash in your pocket!

PM's are worth every dollar. Don't sell yourself short for a % or two, just get a good, quality company. 

Vacancy rate varies. This would be an excellent conversation to have with your PM's or prospective PM's. Its based on your investment area. 

As far as holding the property or letting it go, that is a personal decision. By letting it go, you have a taxable event unless you managed to 1031 exchange it. You can definitely put a nice chunk of $ in your pocket or into another property if you sell. By selling your missing out on the cash flow, write offs, appreciation & depreciation (on your taxes). You just need to decide what is worth more to you and what aligns with your goals! 

Nice work! 

@Cherie Southwick

Would like to know more about your BRRRR deal!

How much did you purchase for?

How much were repairs?

What did the home appraise for?

How much is the home rented for?

How much $ were you able to get back after delayed financing and at what % rate?

How much are your yearly taxes?

How much is your yearly insurance?

What is your expected vacancy rate?

How much is your PM costing you?

@Peter Jaglom thank you! I find the most important thing when going through the rehab is to make sure you are not over improving the property relative to the other rentals you will be competing against. The cabinets are actually original. 3k to replace them or $600 to remove them, sand them down, throw new hardware and some paint on them. You know what direction I took =). Bathrooms we just painted and cleaned up. 

At the end of the day, a clean unit that can comfortably house a family is all I am looking for. If there is deferred maintenance and it does not impact safety or the aesthetic quality of the home, then I will continue to defer it! Another tip would be to find yourself a great property manager. The best ones have all of the basic rehab type people available for your disposal. You and your PM should have aligned interests, and keeping money in your pocket should be at the top of that list. 

@Steven N. This result is pretty typical. I have taken down a handful of these. I did get a little lucky on the appraisal, but that comes from buying the crummiest house in a nice neighborhood =) 

@David Acosta thank you david! I did not have a ton of familiarity, but this is not my first rodeo investing outside of my hometown (NYC). Its all about the team and acquiring as much knowledge as possible before pulling the trigger. Fayetteville from surface level is an excellent rental market. 

I see you are interested in multifamily. Lets connect, I personally will be moving up in asset class soon! 

@James Marshall strongest reply in this thread so far!

Buy when it’s good, buy when it’s bad, buy when it’s okay. If you purchase correctly and it fits into your long term plan, you will make money.