BRRRR Calculator – Analyze Your Rental Property Deal

BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat — a real estate investing strategy popularized by the BiggerPockets community. The goal is to recycle your capital: buy a distressed property below market value, force appreciation through renovation, rent it out, then refinance based on the new, higher value to pull your money back out and deploy it into the next deal.

This BRRRR Deal Analyzer walks you through all five steps and tells you whether a specific deal is worth pursuing. It checks the famous 70% rule, calculates your total project cost, shows how much capital you can recover through refinancing, and projects your ongoing cash flow and cash-on-cash return.

The 5 Steps of BRRRR

• Buy — Acquire a distressed or undervalued property, ideally well below market price. The profit is made at purchase.
• Rehab — Renovate the property to increase its value. Include a 10–20% contingency for surprises.
• Rent — Place a tenant to generate income and stabilize the property's value.
• Refinance — Get a new mortgage based on the After Repair Value (ARV). Lenders typically let you borrow 70–80% of ARV.
• Repeat — Use the capital you pulled out to buy the next property and start again.

The 70% Rule

The 70% rule is a quick filter used by house flippers and BRRRR investors: your Maximum Allowable Offer (MAO) should be no more than 70% of the ARV minus the repair costs.

MAO = (ARV × 0.70) − Rehab Costs

• If your purchase price is at or below the MAO, you've built in a margin of safety.
• If you're offering well above the MAO, the deal may not leave enough equity to refinance all your capital out.
• The 70% rule is a guideline, not a law — hot markets may push you toward 75–80%, but the margin shrinks.

Capital Recovery and Infinite Returns

The magic of BRRRR is capital recovery. If your total project cost (purchase + rehab + holding + closing) is less than what you can pull out via refinance, you recover 100% of your money — and sometimes pull out a profit. When your cash left in the deal hits zero, your cash-on-cash return becomes infinite, because you earn ongoing cash flow on money you no longer have tied up.

This is how investors build large portfolios with limited capital: the same dollars fund deal after deal.

Key Metrics Explained

• Cash-on-Cash Return — Annual cash flow ÷ cash left in the deal. Measures your yield on the capital still tied up.
• Capital Recovery Rate — Net refinance proceeds ÷ total project cost. The % of your money you get back.
• DSCR (Debt Service Coverage Ratio) — Net operating income ÷ new loan payment. Lenders usually require ≥ 1.25 for DSCR loans.
• Cash Left in Deal — Total project cost − net refinance proceeds. The capital still locked in the property.

Risks of the BRRRR Strategy

• Overpaying for the purchase or the rehab — the deal is made or lost at acquisition and budgeting.
• Rehab cost overruns and timeline delays increase holding costs.
• Appraisal risk — if the ARV doesn't appraise, your refinance amount drops and you're left with more cash in the deal.
• Refinance risk — rate spikes or tighter lending standards can shrink your proceeds.
• Low cash flow — a deal that recovers capital but cash-flows poorly can still be a bad investment.