BRRRR — Buy, Rehab, Rent, Refinance, Repeat — is how many investors scale a portfolio without needing fresh cash for every deal. Done right, you pull most or all of your capital back out and redeploy it.
Buy (below market)
The whole strategy hinges on buying a distressed or undervalued property below its after-repair value (ARV). A common guardrail is the 70% rule: pay no more than 70% of ARV minus repair costs. Thin acquisition margins kill BRRRR.
Rehab (to force value)
Renovate to raise both the appraised value and the achievable rent. Budget conservatively and pad for overruns — rehab is where timelines and returns slip.
Rent (to stabilize)
Place a qualified tenant at market rent. Lenders want to see the property stabilized and producing income before they'll refinance on its new value.
Refinance (to recycle capital)
Refinance into a long-term loan based on the new ARV — often a DSCR loan underwritten on the property's cash flow rather than your income. If the new appraisal and rent are strong enough, you pull out most of your invested capital.
Repeat
Use the recovered capital as the down payment on the next deal. The same dollars work across multiple properties over time.
The risks to manage
- Appraisal risk: a low ARV appraisal traps your capital.
- Rate risk: higher rates at refinance shrink cash flow and how much you can pull out.
- Rehab risk: overruns erode the margin you bought.
Every BRRRR deal still has to cash-flow after the refinance. Screen candidates on ARV discount, cap rate and post-refi DSCR — exactly what CashFlowRE scores. Start free.