Our Properties
#1 The BRRRR Experiment
5 Bed 2 Bath SFR Oklahoma City - This was our first foray into the Real Estate market. We had only just begun educating ourselves toward the end of July 2019 and on August 7th we bought this house. This was a big deal for us, because not only were we testing out the BRRR method, we were also doing it out of state… we jumped right in!!
The numbers:
Purchase price $83,500
Renovation $18,000
Total Invested $101,500
It took 12 weeks to do a full renovation which included a garage conversion that moved it from a 3 bed 2 bath to a 5 bed 2 bath. It ended up ARV'ing at $147,000 and is currently renting for $1350 per month.
Lessons Learned:
So many but here are our top 3:
The numbers:
Purchase price $83,500
Renovation $18,000
Total Invested $101,500
It took 12 weeks to do a full renovation which included a garage conversion that moved it from a 3 bed 2 bath to a 5 bed 2 bath. It ended up ARV'ing at $147,000 and is currently renting for $1350 per month.
Lessons Learned:
So many but here are our top 3:
- Don't be afraid of buying something you cannot drive to see.
- Expect your rehab to take longer than estimated… duh!
- Hard Money is not so bad if it still works with the numbers.
#2 Delayed Financing
4 Bed 2 Bath SFR Oklahoma City - OK… the BRRRR method seems to be working so why not try it again with a small variation. A few weeks after we bought our first home, we found this and thought it was a good deal. We bought it based on the math and never saw the inside, which was probably a good thing. It was so TRASHED that if we had seen it we would probably have walked away. We ended up adding the Rehab cost directly to the HUD and paid cash for the home.
The numbers:
Purchase price $32,000
Renovation $28,000
Total Invested $60,000
It took 10 weeks to do a full renovation which included EVERYTHING. This house was so trashed that it literally needed everything done. It ended up ARV'ing at $91,500 and is currently renting for $950 per month.
Lessons Learned:
The numbers:
Purchase price $32,000
Renovation $28,000
Total Invested $60,000
It took 10 weeks to do a full renovation which included EVERYTHING. This house was so trashed that it literally needed everything done. It ended up ARV'ing at $91,500 and is currently renting for $950 per month.
Lessons Learned:
- Do not be afraid of a house that is COMPLETELY TRASHED.
- Get a Property Manager involved as soon as you can.
- Do not send the entire Rehab check to the contractor on day 1. Rookie mistake!
#3 Storage Units?
3 Bed 2 Bath and 60 Storage Units !!– We knew this was a GOOD DEAL the moment we ran the numbers but the idea of managing 60 storage units was very intimidating. The more we looked at the math the more we knew it was a good deal so…. Why not?!
The numbers:
Purchase price $ 347,000
Renovation original budget $100,000
Total Invested $447,000
We partnered on this deal to share the learning, work and the overall risk. Because of non conforming nature of the property it took us forever to close but we got it done. We had the property commercially appraised after the renovation and it came in at $630,000.
The house needed a major renovation and the original 8 week estimate went way over mostly due to COVID-19 but also because we changed the original renovation plan and split the main home into a duplex (3-bedrooms 1 bath unit & 1 bedroom1 bath unit).
Something new for us this time are the 60 storage units. The storage business consisted of 16 exterior garages, 24 smaller units in climate controlled building as well as 18 spots for boats and RVs and a large 3 bay shop. We have a website up and running so the storage business can be fully self-serve. We hired a call center to take customer calls and so far this is working well.
Lessons Learned:
…persistence, Persistence, PERSISTENCE!! If the math makes sense be persistent and keep asking yourself how we can make this work.
The numbers:
Purchase price $ 347,000
Renovation original budget $100,000
Total Invested $447,000
We partnered on this deal to share the learning, work and the overall risk. Because of non conforming nature of the property it took us forever to close but we got it done. We had the property commercially appraised after the renovation and it came in at $630,000.
The house needed a major renovation and the original 8 week estimate went way over mostly due to COVID-19 but also because we changed the original renovation plan and split the main home into a duplex (3-bedrooms 1 bath unit & 1 bedroom1 bath unit).
Something new for us this time are the 60 storage units. The storage business consisted of 16 exterior garages, 24 smaller units in climate controlled building as well as 18 spots for boats and RVs and a large 3 bay shop. We have a website up and running so the storage business can be fully self-serve. We hired a call center to take customer calls and so far this is working well.
Lessons Learned:
…persistence, Persistence, PERSISTENCE!! If the math makes sense be persistent and keep asking yourself how we can make this work.
- Share the risk… find a partner!
- Commercial loans are intimidating but come with a set of benefits
- You cannot plan for COVID-19