This deal analysis breaks down an elusive Partial BRRRR in Colorado Springs. I found this property off-market and presented it to the buyer, as it met his deal profile.
This property closed Q4 – 2020.
- Purchased one rental property prior to this one
- This is the first BRRRR property he purchased
- Listen to the podcast “#14: Deal Analysis – Colorado Springs Partial BRRRR” on the Colorado Springs Real Estate Investing Podcast
- Watch the YouTube video (at the bottom.)
- Read the blog post. Note, the blog is an executive summary. Get the in-depth breakdown from the podcast or video.
Deal Quadrant: Networking
Investment Property Details
- Type: Single Family Home
- 3 bedroom, 1 bathroom
- Location: Platte and Circle
- List Price: $211,000
- Purchase Price: $211,000
- Why we liked it:
- Room for equity play
- In good condition, needs some system work (electric, furnace, water heater)
- Currently rented with a long-term tenant
- This is buyer’s first BRRRR, and with the equity room, this will be a fantastic opportunity to learn the process and work with renovations with “room for mistake.”
Property Contract Details
- Finding the property: Secret Sauce- I found this property off-market for this buyer
- Under contract: Acting fast (2 week close), buyer provided the seller with her wishlist offer and cash/quick close, it was a great match for both buyer’s wants and seller’s wants- everyone was very happy with the win-win!
- Inspection Concerns/Negotiation Outcome:
- None – Buyer waived the right to object but did not waive inspection termination
Property Financing Details
- Lender: Cash
- Loan Type: N/A- Buyer is exploring cash out refinance options to be able to repeat this process on future properties
- Appraisal: N/A
- Seller Concessions: $1,000- there were a few items of confusion on appliance inclusions upon initial contract and after discovering the tenant owned some.
- PMI: N/A
- Interest Rate Buy Down?: N/A
- Buy: Purchased for $211,000 and ~$2,000 in closing costs, cash purchase
- Renovate: Estimated rehab of $25,000, All In: $238,000
- Rent: Currently rented at $1050/mo. Current Market Rate Rent at $1450/month. Great tenant residing in the property that Buyer plans to work with to keep him there.
- Refinance: Estimated ARV at $265,000, New Loan estimated at $199,000 (75%) (not including closing costs)
- Total cash in home: $39,000 (14.7% of appraised home value) with 25% equity in the home.
- Compared to putting down $53,000 (20%) OR $66,250 (25%) or to purchase a fully renovated home at $265,000. Additionally, the ARV could be upwards of $275,000 depending on level of upgrades.
For more Colorado Springs Deal Analyses including house hacks and multi family properties, check out our Colorado Springs Deal Analyses page.
YouTube Video: Rental Property Analysis – Colorado Springs Partial BRRRR
Podcast (colorado-springs-real-estate-investing-podcast): Play in new window | Download (Duration: 22:15 — 25.5MB)
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