What I discovered is something I have never seen anyone speak about on Bigger Pockets (I am sure someone has discussed this I just have not seen this idea discussed at all...or anywhere in my short research period on cash flow and real estate properties.We hear everyone speak about Cash Flow, NOI, Cap Rate or Cash on Cash returns.. however I think there is another important benchmark for investors to consider when deciding their down payment percentage and financing levels because of their effects on cash flow...Capital Cost per $1 of Cash FlowOne of the most illuminating aspects of real estate investing is financing isn’t bad...Having spent all of my life not accumulating debt this has been a difficult psychological barrier to break through.

from the way I understand it, the things that would worry me about the brrrr strategy given your situation are these:1) need to include closing costs on top of 20% dp, let's estimate $3500 just to be safe.2) how to make absolutely certain your remaining funds would increase the value of the $100k rental to $138k.

I spoke with a Quicken Loan lender just to get a quick estimate of what kind of price range I was looking at for my first REI (also first home purchase).

Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbookConsider checking out HUD homes for small multi's owner occupied gets first crack.

I estimate $1500 a year for both cap ex and repairs. anything left over from repairs goes to savings for cap ex.

Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbookConsider checking out HUD homes for small multi's owner occupied gets first crack.

Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbookConsider checking out HUD homes for small multi's owner occupied gets first crack.

Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbookConsider checking out HUD homes for small multi's owner occupied gets first crack.

Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbookConsider checking out HUD homes for small multi's owner occupied gets first crack.

Its hard to find comps in the little town we are in, but I am estimating the house would sell for 150-180k, rent would be about $1000, with a $750 positive cash flow.