All Forum Posts by: Eric Miller

Thank you for the answers, I appreciate the insight and it’s helpful to see different perspectives on the same question. 

The example does actually reflect my situation but I tried to keep it as simple as possible. 

I hadn’t thought about the risk of expanding my portfolio by having multiple properties over leveraged, although that seems to be a growth strategy that many use,  I’m not sure it’s one I’m comfortable with. 

I'm working on part of an investment strategy and I'm curious about having one more valuable property that, either through a large down payment or BRRR method comes in at 70 LTV, versus using creative financing to have multiple less valuable properties at high LTV.

So, assuming all properties would be at just above break even, is it better to have one $600k property at 70% LTV, or four $300k properties at 95% LTV? 15 - 20 year hold time.

The rental investment calculators show that the four $300k properties would have a lot more equity in the future and many times the cash flow after a few years, but does the extra maintenance, management time and expense, etc. outweigh the numbers?

Is having more properties always better than one nicer property?

Can of worms opened!

Good points, thank you.

Is there a general rule for how much rehab to do to increase the appraisal value vs. keeping the rehab limited to what would normally be done for a rental?

I've done a couple of flips but I'm closing next week on the first property I plan on BRRRing and I have a question about increasing value.

Most of the value increase will come from normal rehabbing, kitchen, adding a bathroom, and generally updating it from it's current poor condition. It's on a small bit of land with amazing views.

Where I'm stuck is when I should reconfigure the floor plan and also add a dormer to the attic space - now, prior to renting it out? Or wait until I sell it in 20 years or so? If I do it now it won't make much difference in the rental rate, certainly not enough of a difference to pay for the extra $$$ added to the refi, but it will add a lot of square footage, get rid of a strange floor plan, and open up beautiful views of the mountains. It would definitely increase the ARV by 20% or more.

If I was flipping I would do all of the work now.

Any general rule of thumb for a BRRR? Keep it cheap so it pencils out for a rental or increase the value?