What Is the BRRRR Strategy?
BRRRR — Buy, Rehab, Rent, Refinance, Repeat — is the most popular capital-recycling framework in residential real estate investing. The concept is simple: buy a property below market value, force appreciation through renovations, stabilize it with a tenant, then cash-out refinance at the new higher value. If the math works, you pull most (or all) of your cash back out and redeploy it into the next deal.
The strategy works because banks lend against appraised value, not what you paid. If you buy a house for $150k, put $30k into rehab, and it appraises at $220k, a 75% LTV refinance gives you a $165k loan — enough to pay off the original mortgage and recover your rehab spend. For a deeper walkthrough, see our complete BRRRR strategy guide.
How the BRRRR Calculator Works
This calculator mirrors the BRRRR engine inside Will It Flow. It models two stages:
- Acquisition: purchase price + closing costs + rehab budget = total cash invested. The initial loan covers everything above your down payment.
- Refinance: a new loan at 75% of your ARV. The old loan is paid off, and whatever is left over comes back to you as capital returned.
After the refi, the calculator recalculates your monthly P&I on the larger loan, subtracts operating expenses, and shows your post-refi cash flow and cash-on-cash return on whatever capital remains in the deal.
Key Numbers to Watch
- Capital Return %: How much of your total cash invested you get back at refi. 100%+ is the BRRRR holy grail — infinite cash-on-cash because you have zero dollars left in the deal.
- Cash Left in Deal: Whatever capital the refi didn't cover. Lower is better; zero is perfect.
- Post-Refi Cash Flow: The monthly number that actually hits your bank account after the bigger loan payment. Negative post-refi cash flow means the deal costs you money every month despite the capital recovery.
- Post-Refi Cash-on-Cash: If you left cash in the deal, this tells you what annual return that trapped capital is earning. Compare it to what you'd earn deploying elsewhere.
Tips for a Successful BRRRR
- Be conservative on ARV. Lenders appraise; you estimate. A 10% miss on ARV can swing capital return from 100% to 70%.
- Build rehab contingency. Add 15–20% to your contractor bids. Surprises behind walls are the norm, not the exception.
- Lock in rates early. If rates rise 50bps between purchase and refi, your post-refi cash flow drops and DSCR may not qualify.
- Season the deal. Most lenders require 6-month seasoning before a cash-out refi. Budget for carrying costs during that window.
Related Free Calculators
- DSCR Calculator — check if your refi loan meets lender debt service coverage requirements.
- Cap Rate Calculator — see the unleveraged yield before and after rehab.
- Mortgage Payment Calculator — monthly P&I with live Freddie Mac rates.
- 1% Rule Calculator — quick rent-to-price screen for cash flow deals.
Ready for the full analysis?
Will It Flow runs a complete BRRRR analysis alongside 15+ other metrics — cap rate, DSCR, IRR, multi-year hold projections — in 60 seconds. Free to start.
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