Strategy
BRRRR Calculator
Evaluate a Buy, Rehab, Rent, Refinance, Repeat deal end to end.
Deal breakdown
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How rental property returns work
BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. It is a strategy for building a rental portfolio with minimal capital left in each property. The idea is to buy a distressed property, renovate it, rent it out, then refinance based on the new appraised value — pulling most or all of your original cash back out to fund the next deal. The property becomes a performing rental, and your capital recycles. The first key metric is total cash invested — the purchase price plus rehab plus buying closing costs plus holding costs during the renovation. This is everything that comes out of your pocket before the refinance. The refinance is where the strategy earns its name. The lender bases the new loan on the after-repair value (ARV), not your purchase price. A common refinance loan-to-value (LTV) is 75–80%. The refinance loan amount = ARV × (LTV / 100). If that loan is large enough to repay your total cash invested, you have pulled all capital out — the ideal outcome. If it falls short, the difference is your cash left in deal. After refinancing, the property carries a new mortgage. The monthly cash flow = monthly rent − operating expenses − new mortgage payment, and the cash-on-cash return compares that annual cash flow to the cash you still have tied up. If you recovered all capital, the return is effectively infinite — the calculator labels it "all capital recovered" rather than dividing by zero. The equity after refinance = ARV − refinance loan — the value you own free and clear. BRRRR works best when you buy below market, rehab efficiently, and force appreciation so the ARV supports a strong refinance. If the refinance loan does not cover your costs, you have capital trapped in the deal and the strategy is less effective.
Worked example
You buy a property for $120,000, spend $30,000 on rehab, $4,000 on closing costs, and $3,000 on holding costs during renovation. Total cash invested = $120,000 + $30,000 + $4,000 + $3,000 = $157,000.
After rehab the property appraises at $220,000 (ARV). You refinance at 75% LTV on a 7% interest rate, 30-year term. The refinance loan = $220,000 × 0.75 = $165,000. Cash left in deal = max(0, $157,000 − $165,000) = $0 — you recovered all capital.
The new mortgage payment on $165,000 at 7% for 30 years is about $1,098/mo. Monthly rent is $1,900 and operating expenses are $450/mo. Monthly cash flow = $1,900 − $450 − $1,098 = $352. Annual cash flow is about $4,224. Since cash left in deal is $0, the calculator reports all capital recovered rather than a cash-on-cash percentage. Equity after refinance = $220,000 − $165,000 = $55,000.
Frequently asked questions
What is the BRRRR strategy?
BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. You buy a distressed property, renovate it, rent it out, then refinance based on the new appraised value to pull your capital back out. The goal is to own a cash-flowing rental with little or no money left in the deal, then recycle that capital into the next property.
What LTV should I use for the refinance?
Most BRRRR lenders refinance at 70–80% of the after-repair value. A lower LTV leaves more equity but more cash trapped in the deal. A higher LTV recovers more capital but increases the mortgage payment and reduces monthly cash flow. 75% is a common middle ground.
What does "all capital recovered" mean?
If the refinance loan is large enough to repay your total cash invested, you have zero cash left in the deal. Your cash-on-cash return is effectively infinite because you have no capital tied up. The calculator reports "all capital recovered" instead of dividing by zero, which is the ideal BRRRR outcome.
What counts as total cash invested in BRRRR?
Total cash invested includes the purchase price, rehab cost, buying closing costs (loan fees, inspection, title), and holding costs during renovation (interest, taxes, insurance, utilities). It is everything that comes out of your pocket before the refinance puts cash back in.
Why is my cash left in deal not zero?
If the refinance loan (ARV × LTV) is less than your total cash invested, the difference stays trapped in the property. That means the ARV did not rise enough relative to your costs, or the LTV was too low. You can improve the outcome by buying cheaper, rehabbing more efficiently, or increasing the ARV.