BRRRR for Beginners & The “Lazy” Method to Raise Rents (Rookie Reply)
Summary
This article from the Real Estate Rookie podcast discusses the BRRRR (Buy, Rehab, Rent, Refinance, Repeat) strategy and its modified form. It also addresses the increasing cost of home insurance and ways to mitigate it. Finally, the article provides tips on how to structure a partnership when investing in real estate.
Key Insights
- •Rising insurance costs are becoming a common reason that deals aren't penciling out, especially in certain parts of the country.
- •The article references the BRRRR strategy. The primary goal is to refinance the property to get all of the initial investment back.
Action Items
- ✓Consider the implications of rising insurance costs when evaluating the profitability of your rental properties and factor it into your pricing strategy.Effort: lowImpact: medium
- ✓If considering a partnership, clearly define roles, responsibilities, and decision-making processes in an operating agreement for the LLC. Consult with a syndication attorney for guidance.Effort: mediumImpact: medium
Watch Out For
- ⚠If investing with partners, ensure each investor has an active role in the deal and isn't solely a passive investor, as this could lead to legal issues. Consult with an attorney.
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