What You Need To Know About The BRRRR Method When Buying Investment Real Estate in Los Angeles

What You Need To Know About The BRRRR Method When Buying Investment Real Estate in Los Angeles

Investors have multiple strategies and techniques used to analyze and purchase investment real estate in Los Angeles. It today’s post, we will provide information about the BRRRR method and how it can help you generate wealth!

There are a lot of rules of thumb, equations, and formulas investors use in real estate. The LTV, cap rate, the 1% rule, the 50% rule, and the 70% rule are all useful equations when buying an investment property. But a great formula for investing (and profiting) is referred to as the BRRRR method. Keep reading to learn more about what it means, how you can benefit, and what our team can do to help you!

What Does It Mean?

The BRRRR method is a popular formula used by Los Angeles real estate investors who are just starting out. BRRRR stands for buy, rehab, rent, refinance, and repeat. Using this simple formula, investors are able to begin to grow a real estate investment business, building a large portfolio of properties that build wealth for the investor and his/her family.

Step 1 – Buy

The first step is to find a property that meets your buying criteria. Our team can help you find the right property, complete with a full analysis, ensuring you are getting a great deal. That first property purchase can be roughest because you aren’t sure exactly what to do, but if you add a professional buyer to your team, you’ll be able to find discounted Los Angeles property that will make an excellent addition to your growing portfolio.

Step 2 – Rehab

Rehabbing (or remodeling) the property can be tricky as well. Do you have construction experience? Do you understand the different costs that will be associated with rehabbing? If not, you’ll want to work with someone who has the proper qualifications. You may think you are able to correctly estimate all costs, but it never hurts to get the opinion of a professional. At Jennifer Buys Houses, when you purchase a property from us, you will receive an expert analysis of the property that will help you accurately estimate any repair costs you may face. There are things first-time investors will often overlook, but working with Jennifer Buys Houses will ensure you have all of the facts you need.

You’ll also want to find simple ways to add value to the property that won’t cost you as much as you originally thought. You could fix up the countertops, replace the old windows, upgrade the flooring, or swap out the appliances. Even small things such as changing out hardware, basic landscaping, or a fresh coat of paint can add just the right appeal to your property when it’s time to rent it out.

Step 3 – Rent

Finding the right tenants may feel like a challenge, but if you properly screen them and stick to high standards, you’ll have your place rented in no time. Take a look at what comparable properties are renting for and either price your slightly lower or add a feature that the other properties lack. You could include internet, basic furnishings, patio furniture, or a wine fridge depending on your target demographic. Get creative with it so you can attract great, long-term renters for your Los Angeles investment property. As a landlord, your goal is to find someone who will want to stay in the house for a long time and who will also be respectful of your property, treating it as if it were their own. With the right additions and upgrades, you will be able to rent out your house right away!

Step 4 – Refinance

The next step in the process is to refinance the property. This can cost you a little money, but the rewards are definitely worth it. The goal is to take all of the money you pull from the house after you refinance it, and put it towards your next Los Angeles real estate investment. This is how the cycle really begins and how you can rapidly turn one investment into a portfolio of excellent properties.

Step 5 – Repeat

Now, you do it all over again. This is how investors all over the United States started their real estate investment journey. After this first one, things begin to make more sense. You will get into a rhythm and will have a better understanding of which properties are the right ones for your investment needs. Once you have done a few, you’ll realize how simple it can be to invest in Los Angeles real estate and you’ll wish you would have started sooner.

Are you ready to invest in Los Angeles? Find out how our team can help you find Los Angeles investment real estate with high ROI. We help novice investors, as well as seasoned professionals, find the perfect properties to add to their portfolios. We are here to answer any questions you have about investing in Los Angeles real estate.

This is one of the best times to start buying investment real estate in Los Angeles using the BRRRR method. Reach out to us today to find out how we can help! (424) 242-9304

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