BRRRR Method Calculator

The BRRRR Method Calculator models a full Buy, Rehab, Rent, Refinance, Repeat real estate deal from start to finish. It takes your purchase price, rehab budget, holding costs, after-repair value (ARV), refinance terms, rent, and operating expenses, then shows your all-in cost, the instant equity you create, how much cash the cash-out refinance returns, how much cash is left in the deal, your monthly cash flow, and your cash-on-cash return — including whether you reach the famous "infinite return."

What is the BRRRR Method?

BRRRR is a real estate investing strategy built around recycling the same pool of cash deal after deal. Instead of leaving a big down payment locked in each property, you force up a property's value through renovation and then refinance to pull your cash back out. The five steps spell the name:

BRRRR Formulas

When cash left in the deal reaches zero, your cash-on-cash return — annual cash flow divided by cash invested — divides by zero and becomes effectively infinite. That is the outcome BRRRR investors chase.

A Worked Example

Suppose you buy a distressed house for $120,000 in cash, spend $3,000 on purchase closing, $35,000 on rehab, and $4,000 on holding costs — an all-in cost of $162,000. After the work, it appraises at an ARV of $230,000, so you created about $68,000 of instant equity. Your bank refinances at 75% of ARV, a new loan of $172,500. After $4,000 in refinance closing costs you pull out about $168,500 — more than the $162,000 you put in. You have recovered 100%+ of your cash, leaving roughly $0 in the deal, while it still rents for $1,900/month. With no cash left in, the cash-on-cash return is effectively infinite — a textbook BRRRR.

What is a Good Capital Recycled Percentage?

These ranges are guidelines, not guarantees. A lower recycle percentage can still be a fine long-term rental; it just ties up more of your capital and slows how quickly you can scale.

The 75% Rule of Thumb

Because many lenders refinance at 75% of ARV, a popular target is to keep your all-in cost at or below 75% of the ARV. If you do, the new loan can usually repay everything you invested, leaving little or no cash in the deal. Our live preview flags whether your all-in cost is within the 75% rule as you type, so you can sanity-check a deal in seconds.

BRRRR vs House Flipping vs Buy-and-Hold

• House flipping buys, rehabs, and sells for a one-time profit. BRRRR does the same buy-and-rehab work but keeps the property and refinances instead of selling, so you keep the cash flow and future appreciation.
• Traditional buy-and-hold typically buys a rentable property with a 20–25% down payment that stays locked in the deal. BRRRR aims to recover that cash through the refinance so it can be reused.
• BRRRR combines the forced-equity upside of flipping with the long-term wealth of buy-and-hold — at the cost of more work, more risk, and a reliance on the rehab actually lifting the appraised value.

Risks to Watch

• Low appraisal: if the ARV comes in below your estimate, the refinance returns less cash and more stays trapped.
• Rehab overruns: repairs almost always cost more and take longer than planned, raising your all-in cost.
• Holding costs: taxes, insurance, utilities, and loan interest accrue the whole time the property sits empty during rehab.
• Rate and seasoning rules: higher refinance rates shrink cash flow, and some lenders require a "seasoning" period before they will refinance at full ARV.

How to Use This Calculator

1. Enter the buy & rehab numbers: purchase price, purchase down payment (use 100% for an all-cash buy), purchase closing costs, rehab budget, and holding costs.
2. Enter the ARV & refinance terms: after-repair value, refinance LTV, interest rate, term, and refinance closing costs.
3. Enter rent & expenses: monthly rent, vacancy allowance, annual property tax and insurance, and other monthly expenses.
4. Click Calculate: review your all-in cost, equity created, cash recovered, cash left in the deal, the Capital Recycled gauge, and the five-stage BRRRR pipeline.

Frequently Asked Questions

What is the BRRRR method?

BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. You buy an undervalued property, renovate it to force up its value, rent it out, then do a cash-out refinance against the new higher value to pull most or all of your invested cash back out, and repeat the process with the recycled capital on the next deal.

How is cash left in the deal calculated?

Cash left in the deal equals the cash you invested up front (down payment plus purchase closing costs plus rehab plus holding costs) minus the cash you recovered at refinance. Cash recovered equals the new refinance loan minus any loan you had to pay off minus refinance closing costs. If the result is zero or negative you pulled out everything you invested.

What is the after-repair value (ARV)?

The after-repair value is the estimated market value of the property once the rehab is finished. Refinance lenders base your new loan on the ARV, usually lending 70 to 75 percent of it, which is what allows a BRRRR investor to pull cash back out after forcing up the value through renovation.

What is a good Capital Recycled percentage?

Capital Recycled is the share of your invested cash you get back at refinance. Investors aim for 80 to 100 percent or more. Reaching 100 percent means you recovered all of your cash and your cash-on-cash return becomes effectively infinite, which is considered the BRRRR holy grail. Below 50 percent most of your cash stays trapped, making it slow to repeat.

Why can a BRRRR return be infinite?

If the cash-out refinance returns all of the money you invested, you have zero of your own cash left in the property while it still produces positive cash flow. Cash-on-cash return divides annual cash flow by cash invested, and dividing a positive number by zero is mathematically infinite, so the return is described as infinite or undefined.

What is the 75 percent rule in BRRRR?

A common rule of thumb is to keep your all-in cost at or below 75 percent of the ARV. Since many lenders refinance at 75 percent of ARV, staying under that figure means the new loan can repay all of your invested cash, leaving little or nothing in the deal. It is a guideline, not a guarantee, and depends on your lender and market.

Additional Resources

• Real Estate Investing - Wikipedia
• Refinancing - Wikipedia