Finance & Economics / Real Estate Investment
BRRRR Strategy Calculator
Estimated value after renovations (based on comps)
Typical refinance: 70-75% of ARV
Excluding mortgage payment (calculated separately)
What is the BRRRR Strategy?
BRRRR stands for: Buy, Rehab, Rent, Refinance, Repeat. It's a real estate investing strategy to build a rental portfolio with limited capital.
The 5 Steps:
- Buy: Purchase distressed property below market value
- Rehab: Renovate to increase value (force appreciation)
- Rent: Find tenants to generate cash flow
- Refinance: Get new loan based on higher ARV, pull out invested capital
- Repeat: Use recovered capital to buy another property
Key Metrics for Success:
- 75% Rule: Purchase + Rehab should be ≤75% of ARV
- 1% Rule: Monthly rent should be ≥1% of purchase price
- Positive Cash Flow: Rent > all expenses (mortgage, taxes, insurance, maintenance)
- Conservative ARV: Use actual comps, don't overestimate
Example:
- Buy: $150k (20% down = $30k)
- Rehab: $50k → Total invested: $80k
- ARV: $250k
- Refinance at 75% LTV: $187,500 loan
- Pay off original $120k loan, recover $67,500
- Cash left in property: $12,500 (vs $80k originally)
- Repeat with recovered $67,500!
Risks: Rehab overruns, lower ARV than expected, difficulty refinancing, vacancy, market downturn. Always have reserves and conservative estimates.
See Also
Other calculators in Real Estate Investment
Cap Rate Calculator
Open calculator
Cash-on-Cash Return Calculator
Open calculator
Mortgage Points Break-Even Calculator
Open calculator
1% Rule Calculator (Rental Property Screening)
Open calculator
Rental Property Cash Flow Calculator
Open calculator
1% Rule / 2% Rule Rental Screening Calculator
Open calculator
Fix & Flip Profit Calculator
Open calculator
House Hacking ROI Calculator
Open calculator