All Forum Posts by: Rhonda Davis

Thanks for responding @Mason Hickman.

Thanks @Chris Webb and @Greg Scott. I am not familiar with ROE so I'll read up on it. And you are right Chris about the timing. I was going to see if any long distance turnkeys might work for now. RTR is really interesting to me but if I go that way, I'm sure the numbers will never work for a BRRRR. I might take you up on the offer to double check with your yield calculator.

Okay so my thought process isn't completely off! Thanks again guys!

I have watched and listened to many podcasts teaching the BRRRR strategy. It seems they never emphasize a due diligence step that is important to me. As I now consider making my first BRRRR move, my analysis involves looking at the property numbers even after the cash-out refinance. I mean, I go thru all the steps to calculate NOI, ROI, CoC, etc before making my purchase. So, shouldn't it be equally important to estimate applicable metrics, when my monthly P&I is going to change with the refinance?

Everyone uses the term “pulling money out”. To me, it’s borrowing more the second time than I did the first time on the same property, collecting the same rent. I know. I understand leverage, appreciation, and the Velocity of Money (I think). I will not pocket this pulled-out/borrowed money. I will reinvest.

Still, it seems this is an important point that should be made when teaching BRRRR. For example, my measly $300 monthly cash flow could end up being an even measlier (if that's a word) $200 a month.

It might not mean I shouldn’t do it. But it does mean I should calculate and consider it, during my initial analysis. Right? 

I felt this was coming. Brandon has done a great job and deserves to chill with his family in Hawaii and devote time to his own ventures. I am sure he will continue building his real estate empire. I really do enjoy David and wouldn't it be nice to have say, someone of color or female join him on a regular? Just sayin'.

Thanks to you all for the feedback! I finally decided to refinance. This is such a crazy time for RE right now. I've found no good buys at all. Prices are just unreasonably high and I don't need to put this stress on myself with a 1031. Also, my contractors are crazy busy with more work than they can handle. Since I would buy a place needing work, that's more stress - getting it done timely.

Numbers look good refinancing - cash flow will increase by nearly $200 monthly. Also, I have the resources to still buy a duplex, when I find the right place for the right price - in the right location.

So, my decision is to hold on to this place for the appreciation, with a low fixed interest rate. Thanks again guys!

The main thing really is cash flow. I could get more house for less money in PG County, than here in Alexandria. And in that area I would be cash flowing nicely. My place is nice and I've had no problems. Looking for more CoC ROI and not getting stagnated.

It looks like it's best to refinance now. At some point, I am still able to buy a place in PG County.

Thanks for the advise @Dave Foster

@Chad Duncan thank you so much. This is exactly what I needed - steps to make a more informed decision. 

The new place would be much less than the current. And you are right about not wanting to feel the stress that happens with a 1031 and getting desperate because of the timeline.  Also, I have concerns about contractors having the time to quickly get the new place rentable. In the DMV they are very busy.

Anyway, I'll do the math and make a decision. Thanks again!

I am having a raging debate with myself over selling a condo using a 1031 exchange to buy a better cash flowing property – or – refinance down from 4.625% to 3.375% to get it better cash flowing.

The condo is in a very nice, expensive area but not the best for cash-flow which is less than $50/month. I used $150k from a 1031 exchange to purchase it in 2006. A few years later as the housing bubble burst it went down in value. It’s steadily going back up but would sell for about $75k less than I paid. Ironically, I would walk away with what I put in - $150k.

I would like to buy a SFH or preferably a duplex where the monthly cash flow could be about $150 - $200. Numbers from my banker show that a refi for 30yr fixed would result in me cash flowing about that same amount. But that is extending my debt and I am not sure it's the smartest thing to do.

It’s a good time to refinance. It’s a good time to sell. But it’s a bad time to buy. I feel like I have brain fog and keep going in circles.

I would greatly appreciate someone telling me how they would analyze this and what do they think they might do in this situation. Thanks in advance!

I am having a raging debate with myself over selling a condo using a 1031 exchange to buy a better cash flowing property – or – refinance down from 4.625% to 3.375% to get it better cash flowing.

The condo is in a very nice, expensive area but not the best for cash-flow which is less than $50/month. I used $150k from a 1031 exchange to purchase it in 2006. A few years later as the housing bubble burst it went down in value. It’s steadily going back up but would sell for about $75k less than I paid. Ironically, I would walk away with what I put in - $150k.

I would like to buy a SFH or preferably a duplex where the monthly cash flow could be about $150 - $200. Numbers from my banker show that a refi for 30yr fixed would result in me cash flowing about that same amount. But that is extending my debt and I am not sure it's the smartest thing to do.

It’s a good time to refinance. It’s a good time to sell. But it’s a bad time to buy. I feel like I have brain fog and keep going in circles.

I would greatly appreciate someone telling me how they would analyze this and what do they think they might do in this situation. Thanks in advance!

Hi Bret! I have time and some cash looking to JV on something with an experienced partner. Sent you more details in a PM.