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What is B.R.R.R?

by | Feb 15, 2022 | Clients

CPC Finance talks a lot about B.R.R.R. – do you understand what it means? Here’s a quick outline for you.

If you want to know more about B.R.R.R, you can watch videos of recent projects as part of our B.R.R.R. Property Journey Series. We also have case studies of how other investors have undertaken the B.R.R.R process and you can read Karl Griggs’ perspective on using this strategy in an interview with Property Investor News.

Here’s a quick glimpse of how CPC Finance makes this work in practice:

  • BUY: An investor purchased a three bedroom house of non-confirming construction with adjoining land. The property was purchased for £340,000 with the land and the intention to convert to a five bedroom HMO. CPC Finance arranged a heavy refurbish short term loan of £255,000 and split title on completion. A commercial investment valuation was carried out, which provided a GDV figure of £460,000, which could be relied upon for a 6 month period and excluded the adjoining land.
  • REFURBISH: The investor spent £80,000 to convert the property which included a rear extension and en-suite bathrooms for each of the five new bedrooms.
  • RENT: On completion of the works, the security generated a rental income of £35,000 per annum.
  • REFINANCE: The original valuer re-inspected the property to confirm the works were complete and the original GDV valuation could be relied upon. CPC Finance arranged a product switch to a term facility at 75%, which excluded the parcel of the land – now mortgage free, the investor has the option to build on the land at a later date.

 

 

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