This BRR went wrong #ukpropertymarket #ukproperty #ukpropertyinvestment

Buy refurbish refinance is promoted and celebrated on social media so much. People post BRR success stories because they trend on social media more than any other post. If you notice we don’t post these types of reels. Why? Because BRR is actually quite risky. Here’s why:

1. You’re getting a valuation after the purchase and refurb so if you get a down valuation (which can happen very easily) you can’t back out of the deal. You’re basically screwed. We always purchase on a mortgage and if we get a down valuation we can re-negotiate with the agent to reduce the purchase price.

2. You’re looking for the reduction (below market value properties) first which means the properties aren’t usually in high growth areas or city centres. This means more problem tenants (generally) and less capital growth which is where most of the wealth is built!

3. Cash purchases lock everything you have a in a deal (if you have around 100k) meaning you can’t leverage it elsewhere if a good deal comes along.

4. Most people bridge as they don’t have enough capital and this is even riskier as if the refurb goes over (which is usually does) your paying roll on interest.

This project is one of our own properties that not only went over budget it also got down valued and instead of hiding it we thought it was best to highlight that things can go wrong.

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Видео This BRR went wrong #ukpropertymarket #ukproperty #ukpropertyinvestment канала Dan & Jez Kove Properties