CalculateRealEstateROI

Strategy

BRRRR (Buy, Rehab, Rent, Refinance, Repeat)

Recycle capital across multiple properties using forced equity.

Overview

BRRRR is a velocity strategy: buy distressed below market, force appreciation through targeted renovation, stabilize with a long-term tenant, then refinance to pull out most or all of the original cash for the next deal. Done well, BRRRR enables infinite returns. Done poorly, it traps capital in a rehab that doesn't appraise.

Advantages

  • Forces equity rather than waiting for market appreciation
  • Recycles cash so one down payment can fund multiple acquisitions
  • Creates a portfolio of cash-flowing rentals on the same capital base
  • Aligns naturally with B/C-class neighborhoods where comps support rehab uplift

Risks

  • Refinance appraisals may come in below your underwritten ARV
  • Rate environment changes can wreck post-refi cash flow
  • Rehab overruns are common — 10% contingency minimum
  • Seasoning periods (typically 6 months) lock up capital longer than expected

Expected Returns

12–25% cash-on-cash post-refinance when ARV and rehab are underwritten conservatively. Infinite return scenarios require 75% LTV refis plus 25%+ equity creation.

Best For

Operators who can manage contractors, have 30–60 day deal flow access, and want to scale beyond 3–4 properties without raising outside capital.

Best-fit markets

Markets where this strategy historically produces the strongest risk-adjusted returns.

Indianapolis, INKansas City, MOMemphis, TNBirmingham, ALCleveland, OHMilwaukee, WIColumbus, OHCincinnati, OHSaint Louis, MOPittsburgh, PA