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Investment Journey Today
At CityRise, our experienced property sourcing team is dedicated to helping buy-to-let investors identify the best BRRR deals, manage refurbishments, secure refinancing solutions and also have a hands-off investment with our lettings and management service, enabling you to grow your portfolio with confidence.
Step 1: Buy
Finding the Right BRRR Property
The first step in the BRRR strategy is buying the right property. Successful BRRR investments are made by carefully selecting properties with a high potential for value appreciation. Key factors to consider include:
- Location: Select areas with strong rental demand, planned infrastructure developments, regeneration plans and future capital growth potential. Knowing where to invest in the UK is key. We review properties street by street, identifying outliers and comparables that can be used as case studies for your potential refurbishment.
- Market Value: Look for undervalued properties or those sold below market value, as they offer the best opportunities for profit after refurbishment.
- Potential Uplift: Assess the property’s potential for value appreciation through quality, budget adhering renovations, such as adding bedrooms, modernising kitchens & bathrooms, or enhancing curb appeal for example.
At CityRise, we leverage our market expertise and network to identify high-potential BRRR opportunities. Our team conducts thorough market research and property analysis, ensuring you invest in the most profitable deals. In the buy, refurbish, refinance, rent cycle, for you to maximise your ROI, perfecting the “buy” stage is key.
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Step 2: Refurbish
Renovation Strategies that Maximise Property Value
A successful BRRR investment hinges on strategic refurbishments that significantly boost property value without overspending. Effective renovation strategies include:
- A cosmetic upgrade consisting of a fresh coat of paint, new flooring, and modern fixtures to enhance property appeal.
- Structural improvement may include adding bedrooms or bathrooms to increase the overall property value and boost rental income. This may also include resolving issues such as building penetration causing damp. These small yet essential improvements will contribute to the final valuation, ensuring for a profitable refinance.
- Energy efficient upgrades such as installing double glazing or enhancing heating systems. These features will attract eco-conscious tenants.
How do we help with your BRRR investments? At CityRise, we take the hassle out of the refurbishment process by managing every aspect for you with our trusted contractors. From sourcing reliable contractors to overseeing project timelines and budgets, our experienced team ensures high-quality renovations; essential in the buy, refurbish, refinance and rent cycle to maximise your return on investment.
Step 3: Refinance
Release Capital for Your Next Investment
Refinancing is the cornerstone of the BRRR strategy. It involves securing a new mortgage based on the property’s appreciated value after refurbishment, allowing you to extract your initial capital for your next investment. Key aspects of refinancing include:
- Understanding lender criteria
- Loan-to-value (LTV) ratios – most lenders offer refinancing at 75%-80% LTV, enabling investors to access a significant portion of property’s new value.
- Types of refinancing options – interest only or repayment mortgages – this will depend on your investment goals.
CityRise provides expert mortgage advisory services to help you navigate the refinancing section of your buy, refurbish, refinance and rent process. Our team works with trusted lenders to secure the best rates, ensuring you maximise your equity and continue growing your portfolio.
Step 4: Rent
Maximise Rental Income and Tenant Management
After refinancing, the final step of the BRRR process is to rent out the property to tenants and generate passive income. To maximise rental yields, it’s essential to:
- Analyse rental market demand and target those areas with high tenant demand, minimising vacancy rates.
- Set competitive rents by striking a balance between maximising rental income and maintaining long-term tenancy.
- Ensure consistent cash flow through efficient tenant screening, maintenance and rent collection.
CityRise offers excellent lettings and property management services, taking the stress out of tenant management. Our team handles everything from marketing your property to managing tenant relationships, so you can benefit from hassle-free passive income.
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What are the pros and cons of BRRR investments?
The BRRR strategy offers several key benefits, such as reinvesting your initial capital multiple times to accelerate portfolio growth, strategic renovations increase property equity and rental income, and generating a higher rental income while your property value appreciates over time.
In terms of cons, buy, refurbish, refinance and rent cycles can come with high initial costs, potential costs for overruns if renovations aren’t managed properly, as well as the time consuming nature of property management later down the line.
Whilst you do need the finances for the initial costs of down payments and refurbishments, if you choose to work with CityRise for your BRRR investment, our experience ensures that the renovation stage is properly managed to minimise unexpected costs and overruns.
If you don’t want the ongoing task of managing your BRRR property, we can also handle everything on your behalf, from the initial marketing through to maintenance, managing tenant relationships and renewals, for a completely hands off investment.
How can CityRise support through the BRRR process?
At CityRise, we guide investors through each step of the BRRR process, establishing a seamless and profitable property investment. Whether you’re a seasoned property investor or just starting your journey, our team provides expert advice and personalised support to help you achieve your property goals. We have dedicated teams with phenomenal amounts of experience and passion for each stage of the buy, refurbish, refinance and rent process, to guide you through the entire journey for a seamless investment that is as profitable as possible.
What are the key components in making a BRRR investment profitable?
Whilst all of the stages of the BRRR process are key to a profitable investment two main elements are buy and refurbish.
In the buy stage, the property needs to be carefully selected to confirm the potential for appreciation. This includes locations with low house prices (with projections for growth over time) and strong rental demand, identifying BMV properties for a lower entry barrier and higher returns following refinance, and also looking at the property’s potential value following renovation opportunities.
In terms of the refurbishment, in order for it to be a success, you need to identify strategic refurbishments that are cost effective but can significantly boost the value of the property. This could be cosmetic upgrades such as decorating or new flooring, structural improvements to add rooms or bathrooms to the property, or a focus on improving the EPC rating to increase rental yield. Be sure to check out our latest blogs covering updates for minimum ECP rating requirements for landlords.
What is the 70% method in the buy, refurbish, refinance and rent cycle?
The 70% rule in relation to BRRR is a guideline that suggests investors should pay a maximum of 70% of the “After Repair Value” (ARV), which is the estimated market value of a property after all of the repairs and renovations have been completed. This helps to ensure that a strong profit margin is maintained.
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