BRRRR Calculator
Buy & rehab
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Fill in the fields on the left and this updates as you type.
Know what this estimate is based on
- Jurisdiction
- United States — state and local practice
- Scope and limitations
- Educational estimate only. U.S. real estate costs are local: property tax rates, transfer and recording taxes, title practice, who customarily pays which closing cost, and landlord-tenant rules all change by state and often by county or city. Agent commission is negotiable and, since the 2024 NAR settlement, buyer-agent compensation is negotiated separately rather than assumed. Only a lender's Loan Estimate, a title company's fee sheet or a signed contract binds a number.
- Source links checked
- Jul 30, 2026
Built and regression-tested by Smart Tools Lab. It has not been individually reviewed by a licensed financial, tax, or legal professional.
How to use
- 01
Enter the purchase price, the rehab budget and the after-repair value you expect.
- 02
Enter the rent the finished property will command, and the refinance loan-to-value your lender will write.
- 03
Open Advanced options for purchase and refinance closing costs, the holding costs during the rehab, and the refinance terms.
- 04
Read the cash left in the deal — the number the whole strategy is aimed at.
- 05
Check the sensitivity table. The after-repair value is a guess, and it shows what being wrong about it costs.
Formula
The all-in cost is the purchase price plus rehab plus purchase closing costs plus holding costs, assuming the acquisition and rehab were funded with cash or short-term money that the refinance retires. The new loan is the after-repair value times the refinance loan-to-value, and the cash out is that loan less the refinance closing costs, floored at zero. The cash left in the deal is the all-in cost minus the cash out — negative when the refinance returns more than you spent. The new payment is the standard amortising payment on the new loan, operating expenses are a share of rent, and monthly cash flow is what remains. Cash-on-cash divides annual cash flow by the cash left in, and that division is guarded: when nothing remains the return is undefined rather than infinite, and the page says so in words. Equity captured is the after-repair value minus the all-in cost.
Example
Buying at $210,000 with a $65,000 rehab, an after-repair value of $375,000, renting at $2,750, refinancing at 75% LTV with $5,000 of purchase closing, $6,500 of holding costs and $7,500 of refinance closing. Step 1 — All-in: $210,000 + $65,000 + $5,000 + $6,500 = $286,500. Step 2 — New loan: $375,000 x 75% = $281,250. Step 3 — Cash out: $281,250 − $7,500 = $273,750. Step 4 — Cash left in: $286,500 − $273,750 = $12,750. So about 96% of the capital comes back. Step 5 — The ongoing deal: the new payment at 6.75% over 30 years is $1,824, operating expenses at 35% of rent are $963, so cash flow is −$37 a month. Equity captured: $375,000 − $286,500 = $88,500. That is a textbook BRRRR and it still deserves scrutiny. Nearly all the capital is recycled and $88,500 of equity was created — genuinely good. But the finished property loses $37 a month, and repeating this five times means five properties each losing money while the portfolio grows. And the whole thing rests on the ARV. Drop it 10% to $337,500 and the loan falls to $253,125, the cash out to $245,625, and the cash left in jumps from $12,750 to $40,875. One appraisal, arriving after every dollar is committed, moves your outcome by $28,000.
Definitions
- BRRRR
- Buy, rehab, rent, refinance, repeat — a strategy for recycling the same capital across properties.
- After-repair value (ARV)
- What the property is worth once renovated. The estimate the whole strategy rests on.
- All-in cost
- Purchase price plus rehab plus purchase closing plus holding costs. What you must get back.
- Cash left in
- All-in cost minus the refinance proceeds. The capital that stays trapped in the property.
- Refinance LTV
- The share of after-repair value a lender will lend, typically 70% to 75% on an investment property.
- Seasoning
- The ownership period a lender requires before lending against the new value rather than the purchase price.
- Hard money
- Short-term asset-based lending used to fund the purchase and rehab, commonly 10% to 13% with points.
- Holding costs
- Interest, taxes, insurance and utilities during the rehab and before the first tenant.
- Equity captured
- After-repair value minus all-in cost. The value the renovation created.
- Cash-out refinance
- A new loan larger than the existing debt, returning the difference as cash. Not a taxable event.
- Forced appreciation
- Value created by renovation rather than by the market. The engine of the strategy.
- Undefined return
- What cash-on-cash becomes when no capital remains. Not infinite — there is simply no denominator.
Good to know
The strategy is refinancing, not buying
Buy, rehab, rent, refinance, repeat works because the refinance is sized on the property's value after the work rather than on what you paid. All in at $286,500, a 75% refinance against a $375,000 after-repair value returns $273,750 and leaves $12,750 in the house. The capital that comes back is available for the next deal, which is what makes the strategy compound — one pot of money buying several properties over a few years rather than one. The forced appreciation is real: $88,500 of equity captured is the gap between the after-repair value and the loan, created by the renovation rather than by the market. What the strategy is not is free money. The equity is borrowed against, the loan is larger than a conventional purchase loan on the same property, and the rent has to cover it.
A perfect BRRRR still leaves you with a rental
The cash flow here is negative $37 a month, on a property that recycled 96% of the capital invested. That is the tension at the centre of the strategy and it is almost never in the marketing. Refinancing at 75% of the after-repair value puts a much larger loan on the property than a straightforward purchase would, and a larger loan means a larger payment against the same rent. The better the capital recovery, the worse the cash flow — they are the same lever pulled in opposite directions. An investor optimising purely for cash out the door builds a portfolio of properties that each lose money monthly, which works while values rise and becomes a liquidity problem when they do not. Refinancing at 70% rather than 75% leaves more cash in and produces a property that actually pays for itself.
The after-repair value is the assumption that breaks deals
Everything downstream depends on the appraisal, and the appraisal is a stranger's opinion formed after the money is spent. A $10,000 miss on a $375,000 after-repair value costs $7,500 of cash out at 75% leverage — the shortfall is multiplied by the loan-to-value, not absorbed by it. That is why experienced investors underwrite the after-repair value conservatively from closed comparable sales rather than from active listings, and why they build the rehab budget with a contingency the Renovation Cost Calculator would recognise. The other common miss is on the rehab side: a renovation that runs 20% over budget on $65,000 is $13,000 of additional cash in, which here would roughly double what stays in the deal. Both errors compound, and both are far more common than a market decline.
Seasoning is the rule that sets your timeline
Most conventional lenders impose a seasoning requirement before they will refinance against the new value rather than against your purchase price — commonly six months, sometimes twelve, occasionally none for a delayed-financing exception on a cash purchase. That waiting period is not idle: the property must be rented, the rehab receipts documented, and the holding costs paid throughout, which is what the $6,500 of holding costs in this model represents. Portfolio and DSCR lenders are often more flexible on seasoning and less flexible on rate. Plan the timeline before buying, because a strategy that assumed a three-month cycle and meets a twelve-month seasoning rule has its capital locked up four times longer than the model assumed, and the next deal in the sequence does not happen.
Where the strategy is genuinely at its best
BRRRR works best on properties that are cheap for a fixable reason — deferred maintenance, dated finishes, a failed system, a distressed seller — in markets where renovated comparable sales support a value well above purchase plus rehab. It works badly on properties that are cheap for a permanent reason: a bad location, a functional obsolescence, a school district. It also requires three competencies at once, and most people have one or two: finding the deal, running the renovation, and managing the rental. The financing is the easy part. The realistic expectation is not the infinite return the strategy is sold on but a very good one — most capital recovered, meaningful equity captured, and a property that needs to be a decent rental on its own terms, because that is what you are left holding.
Frequently asked questions
What does BRRRR stand for?
Buy, rehab, rent, refinance, repeat. You acquire a property below market, renovate it, place a tenant, refinance against the higher value, and use the returned capital on the next one. The goal is to recycle the same money rather than tie it up.
What does it mean to get all your money back?
That the refinance proceeds equal or exceed everything you put in — purchase, rehab, closing and holding. It does not mean the deal is free; you still own a mortgaged property with a payment. It means your capital is available for the next purchase.
Is an infinite return real?
No, and this page refuses to print one. When no cash remains in the deal there is nothing to divide by, so cash-on-cash is undefined rather than infinite. The meaningful measures at that point are monthly cash flow in dollars and the equity you captured.
What loan-to-value will a lender give on the refinance?
Typically 70% to 75% of the after-repair value for an investment property, sometimes 80% with strong credit. That LTV is what decides whether the capital comes back, which is why it is the most important number on the page after the ARV itself.
What is seasoning?
The time a lender requires you to have owned the property before they will lend against its new value rather than what you paid. Six to twelve months is common, though some portfolio lenders have no seasoning requirement. Budget holding costs for that wait.
How do I fund the purchase and rehab?
Usually hard money, a private lender, a line of credit or cash — the refinance retires whichever it was. This model assumes that structure. Hard money commonly runs 10% to 13% with points, which is why the holding costs field matters.
What if the after-repair value comes in low?
You leave more capital in the deal, proportionally to the LTV. At 75% LTV every $10,000 the appraisal misses costs you $7,500 of returned capital. The sensitivity table on this page exists because that appraisal is a single opinion arriving after all the money is spent.
How accurate are rehab budgets?
Consistently optimistic. Experienced investors add 15% to 20% contingency and still overrun, particularly on older properties where opening a wall reveals wiring or plumbing. Use the Renovation Cost Calculator to build the number rather than estimating it.
Does the refinance reset my depreciation?
No. Depreciation follows your basis — the purchase price plus capitalized improvements — not the loan. Refinancing changes what you owe, never what you can deduct, and pulling cash out is not a taxable event.
What is the biggest risk?
Timing. The strategy requires a rehab finished on budget, a tenant placed quickly, an appraisal supporting your value, and a lender still willing to lend at that LTV — sequentially, with your capital committed throughout. Any one of them slipping is expensive.
Does it still work in a high-rate market?
It gets harder in a specific way: the refinance payment is larger, so the property often cannot support the loan needed to return all your capital and still cash flow. The trade becomes leaving money in the deal or accepting negative cash flow.
Should the deal cash flow after the refinance?
Ideally yes, and this is where BRRRR deals most often disappoint. Pulling out the maximum loan produces the largest capital return and the smallest cash flow — sometimes negative, as it is on these defaults. Recycling capital into a property that loses money each month compounds a problem rather than a return.