Instead of leaving equity tied up in the property, you can refinance and put that money to work on your next investment.Advantages:Leverage: You’re using borrowed money to increase your purchasing power.Long-term Wealth: By holding rental properties, you benefit from appreciation, passive income, and tax advantages.Scalability: The ability to keep reinvesting capital makes it easier to scale compared to traditional buy-and-hold methods.Is BRRR Right for You?

Your mechanicals and capital expenditures are a lot more important and more expensive to fix than a pretty kitchen. its better to live in outdated kitchen and have a well kept home with updated mechanicals/roof/hvac than one that looks pretty but will start to crumble5.

Naturally my biggest hurdle is the capital to fund the projects.

Doing flips to create capital and investing the profits in rentals can be a very profitable investment strategy.If you’re looking to invest in your backyard, it helps to network with as many local investors as you can.

It allows a substantial portion of the asset's cost to be deducted in the first year of service.In 2023, the bonus depreciation rate is 80%.In 2024, it decreases to 60%.In 2025, the rate further reduces to 40%.COST SEGREGATION:Cost segregation involves dividing a property into its individual components for tax purposes.Some parts age faster, like carpets or paint.Your CPA can use this info to more accurately depreciate elements of your property leading to potential tax savings.BASIS:Your basis is the initial price that you paid for your property, including any expenses or improvements.Knowing your basis is crucial for tax purposes, as it's used to evaluate depreciation & determine the capital gains or losses if/when your property sells.LAND VALUE:This is how much your land is worth without any buildings or improvements.Land doesn't get old like buildings, so you can't depreciate it.

Plus reducing capital gains 

After moving out, I’d still be out of pocket $750 to $1,500 a month to cover vacancy, capital expenditures, maintenance, and property management.

This option eliminates my capital needs, since I do not own the property.

I understand that it may take time to build the capital for larger deals, but I’m committed to making it happen. 

Anybody have experience as an LP with Penn Capital?