The key to rehabbing a BRRRR property is to make the property as “tenant proof” as possible, using materials that will last a long time and won’t need to be redone later.
Remember, price does not equal value. As Warren Buffet says, “Price is what you pay, value is what you get.”
Treat appreciation for what it is: a possible reward for an investment done right.
A good friend of mine advises investors that “your business should bring in at least 3X of your current job before thinking of quitting your job. 1X for tax, 1X to survive, and 1X for reinvestment and unexpected events.” I think his advice isn’t too far off.
Tax benefits will never make a bad deal good, but they can make a good deal even better.
If you are looking for a multifamily property, two-bedroom apartments are usually acceptable, and incredibly common. Single-bedroom and studio apartments are also common, but they tend to attract a more transient tenant, so expect more turnover in that style.
Most people see the time between Thanksgiving and New Year’s Day as “holiday” time, so they work half as hard. Savvy investors, however, know that this is the best time all year to find deals, for two reasons.
I’ll repeat myself one last time: buy rental properties that offer cash flow today.
When looking for single-family homes, look for ones for which all utilities (including water, sewer, garbage, electricity, and heat) can be paid directly by the tenant.
The amount of cash you should have in reserves depends on a number of factors, most notably the number of properties you own, the condition/age of those properties, the anticipated cost of fixing the properties (would you do the work yourself? ), saving for larger future big-ticket expenses, and your management abilities. However, I would encourage you to start with six months of expenses for each unit you have.