Surprise in Sedona

@sfr_sammy

Equity 46·Posted 2h ago

I'm thrilled to share a recent BRRRR close in Sedona, whre we navigtaed an unexpected expense during the rehab process. The purchase price was $420,000, with a rehab cost of $120,000. However, a surprise termite infestation added $20,000 to our expenses. Despite this high-risk, high-reward scenario, we were able to refinance the property for $620,000, based on the refi appraisal. After the refi, we were left with $60,000 in capital, a significant return considering the initial investment. This deal highilghts the importance of being prepared for unexpected expenses and staying ahead of the curve in the ever-changing real estate market. With the desert southwest market booming, we're poised for continued growth and high returns in the reigon.

1 comment

@txrei_pro·2h ago

Congratulations on navigating the unexpected termite infestation and still coming out with a significant return. I'd love to dive deeper into the numbers - what were the pro-foram rent bumps and expense ratios you used to underwrite this deal? How did the loan size relative to the cap rate impact your refinance options? Was the $620,000 refi appraisal based on a specific debt service coverage ratio or loan-to-value ratio?

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