BRRRR Strategy Calculator
Calculate how much cash you get back in a BRRRR deal (buy, rehab, rent, refinance, repeat), plus the resulting monthly cash flow and cash-on-cash return on whatever money stays in the property. Designed for real-estate investors using the cash-out refinance model.
What Is the BRRRR Strategy?
BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. You buy a distressed property with cash or hard money, fix it up, place a tenant, then refinance at the new after-repair value — pulling most or all of your cash back out. If executed well, you end up with a cash-flowing rental and most of your capital freed to buy another property. The strategy was popularized by BiggerPockets and is widely used in the 1-4 unit rental market.
How the Refinance Cash-Out Works
Once the property is stabilized (typically 6 months of tenancy), a bank will refinance up to 70-75% of the new appraised value as an investor loan. If your new appraisal is $250,000 and the bank lends 75%, the new loan is $187,500. After paying off your acquisition/rehab loan or cash, the remainder returns to you. The less cash left in the deal, the higher your infinite-return potential.
What Is a Good BRRRR Outcome?
The textbook BRRRR pulls out 100% of your initial cash, but that requires buying at roughly 75% of ARV minus repairs — tighter than the 70% flip rule. In practice, many BRRRR investors accept leaving $5,000-$20,000 in the deal as a working outcome. Cash-on-cash returns on whatever cash stays invested often exceed 15-25% because the base is so small. If zero cash is left in, the cash-on-cash return is effectively infinite.
Risks and Realities
BRRRR assumes the refinance appraisal will hit your expected ARV. A 5% low appraisal can leave tens of thousands more cash in the deal. Interest rates at refinance time drive the new mortgage payment — a market rate spike can flip cash flow negative. And the transition from hard-money (or short-term bridge) to long-term financing must happen cleanly or carrying costs pile up. Conservative underwriting with a 5-10% ARV cushion protects against most surprises.
Frequently Asked Questions
What does BRRRR stand for?
Buy, Rehab, Rent, Refinance, Repeat. It is a real estate investing strategy where you buy a distressed property below market, fix it up, place a tenant, then cash-out refinance into a long-term mortgage at the improved value — freeing your capital to repeat the process on the next property.
How much cash do I need for a BRRRR?
You need the full purchase price plus rehab at the start, either as cash or via a hard-money/bridge loan. A perfect BRRRR returns 100% of that cash at refinance, but plan for 10-25% to remain in the deal. Rough minimum: $30,000-$70,000 on a typical $150,000 property.
What LTV can I expect on a BRRRR refinance?
Most portfolio and conventional investor loans cash-out up to 70-75% LTV on a 1-unit rental (65-70% on 2-4 units). Seasoning requirements vary: Fannie Mae now allows immediate financing at the new appraised value once the rehab is documented; many banks require 6 months of ownership before cash-out.
How do I estimate ARV accurately?
Pull three to five sold comparables within 0.5 miles, similar square footage, bedroom/bathroom count, and condition, closed within the last 3-6 months. Conservatively estimate at the low end of the range. A licensed agent familiar with the neighborhood is the best source; online estimators should only cross-check.
What is the biggest risk in BRRRR?
The appraisal coming in low at refinance. A 5-10% shortfall can leave tens of thousands of extra cash in the deal and change your ROI profile entirely. Build in a conservative ARV (use low-end comps, not the best) and stress-test your numbers with a 5% lower ARV before buying.
How is BRRRR different from flipping?
Flipping ends with a sale and realized profit (taxed as ordinary income or short-term capital gain). BRRRR ends with a rental you keep — no sale, no tax event, ongoing cash flow, long-term appreciation, depreciation tax shield, and loan paydown equity. The tradeoff is that BRRRR moves slower and requires landlord operations.