All Forum Posts by: Shane Kunkle

I'm a first time RE investor and received a personal loan for 250K at 2% over 30 years and would love to get insight.

Option 1: BRRRR deal

-This is what i originally wanted to do but with rates and prices being what they are, it's difficult to find BRRRR deals rn

-My plan would be to do a BRRRR deal out of state as CA is too expensive. Buy a house cash for ~$180K and use the remainder for renovations and reserves.

-Being a first time RE investor, doing an out of state BRRRR might be a lot to bight off at once so I'm considering option 2.

Option 2: Buy a new primary and use my current residence as a rental

-The cashflow from my existing primary will cover the cost of the personal loan. However, the new house is more expensive so it will add approx $1K to my monthly payments

My question: For those who have done out of state BRRRR deals, do you think it's wise to pursue option 1 given my inexperience or go with option 2 to get a feel for RE investing. I understand that a BRRRR done right is going to make me more profit but trying to get an idea of if out of state investing is realistic right off the bat for someone new like me. Any insight is hugely appreciated!

Much appreciated, Minna!

Thank you, Minna! Valid points especially with your experience. Would there be a non-BRRRR option that you'd suggest someone like me look into if I wanted to invest in Jacksonville? I don't want to invest where I live (CA) due to the reasons I named in my original post so looking to invest somewhere that's more business friendly with a deal of course that makes sense. Thank you much.

That's great insight! I knew that BRRRR deals were difficult rn but didn't know they were that difficult so really appreciate you taking the time.

To answer your question, I likely don't know Jacksonville in the way you are meaning. Next steps were to get to know agents, lenders, etc. in the area but wanted to get a general understanding of how difficult this would be at this time which you have helped with. Hoping prices eventually come down with rates continuing to climb.

Again, appreciate your time!

Hi All! First time RE investor living in CA. I've been doing my best to build my knowledge base for the past 2 years reading books, listening to pod casts, etc. and its finally time to take the leap. I have ~$250K via a private loan to invest and I am debating between two ways of doing this (or possibly both) -

1. BRRRR deal - I understand that with rates being what they are, me being a first time investor and me wanting to invest from a distance, it makes a BRRRR deal increasingly more difficult but I'm not in a huge hurry and of course the ROI on a BRRRR (when done right) can be great. The market I'm considering is Jacksonville FL with a PP of $100K for the house and $50K (max) for reno. Jacksonville has a decent diversity of industry, has homes within my buy box and is of course in a business friendly state which is the reason I am considering this. With this option, I would have $100K left in reserves which would keep stress low :-)

-OR-

2. Move to a new home in our city in CA and rent out our current home which will cashflow for approx. $800/month. My concern with this is, our monthly payment on the new house ($500-600K house w/ 20% down [$100 -$120K] = ~$3500/month) plus the private loan monthly payment ($1000) would make things tight (but still doable) for our monthly expenses which is not my favorite idea. Additionally, getting our money back from investing a portion of the private loan in the new house would be much slower than if we were to do a well-executed BRRRR deal. I know that would still have $150 to $130K remaining if i only put 20% down but I'd want to keep at least half of that in reserves so I don't think I'd be able to do both a BRRRR and buy a new primary (while renting out my existing). The other thing is, other than my existing primary res, I am not real interested in investing in CA real estate. Mostly because it is expensive in general and because it isn't super business friendly state (taxes, etc.).

Let me know what I am missing! Any advice is hugely appreciated.