The BRRRR method — Buy, Rehab, Rent, Refinance, Repeat — is one of the most powerful wealth-building strategies in real estate investing. It lets you recycle your initial capital across multiple properties, building a portfolio with minimal cash out of pocket.
how it works
Buy. Find a distressed property below market value. Auctions, pre-foreclosures, and off-market deals are your best sources. The 70% rule ensures you never overpay: MAO = ARV × 0.70 − rehab.
Rehab. Renovate to force appreciation. Focus on kitchens, baths, and curb appeal. Budget conservatively — unexpected costs always appear.
Rent. Place a quality tenant (or Section 8 voucher holder). Your DSCR should clear 1.2 at a 7% rate to qualify for refinancing.
Refinance. After 6 months of seasoning, refinance with a DSCR loan at 75–80% LTV. If your ARV is accurate, you pull out most or all of your initial investment.
Repeat. Take the refinanced cash and do it again. Each cycle adds a cash-flowing property to your portfolio.
the math
Buy at $80k, rehab $20k (all-in $100k). ARV after rehab: $150k. Refinance at 75% LTV = $112,500 loan. You get $12,500 back PLUS own a property that cash flows $300–500/mo.