Have you heard of the BRRR real estate investment strategy yet? It’s a way in which to build a real estate portfolio quickly and stands for: Buy, Remodel/Renovate, Rent, Refinance….some will put another ‘R’ at the end for Repeat. I wrote another post about it a few years ago if you’d like to read more on the traditional approach.
This post is to discuss a non-traditional approach, one that I personally follow, as well many of my investment clients. The acronym is still the same: BRRR, which stands for Buy/Remodel (slightly), Rent, REDEVELOP. Most investors will not redevelop a property originally bought through this approach. I feel if you can buy a property that doesn’t need that much work upfront to rent out at market rates, in a desirable quickly appreciating neighborhood, then you definitely need to consider the exit being a redevelopment of the property. You could then Repeat the process, or take your proceeds and put it down on a income producing multi family investment (or any other desired income producing asset).
Interest rates are at historical lows currently allowing investors to cash flow more until they decide to develop the property. Our local Denver/Boulder markets continue to have low inventory and high demand (both renters and purchasers). Reach out if interested to discuss further!