The BRRRR Method with Real Numbers
The whole strategy lives or dies on one number: the refinance appraisal. Walk the math both ways.
BRRRR (buy, rehab, rent, refinance, repeat) is the strategy of recycling one pot of capital through multiple rentals. The mechanics are simple, and with an honest ARV the pitch is real.
What is usually undersold: the entire sequence lives or dies on one number you do not control, the refinance appraisal. That appraisal is your ARV, graded by someone else.
The math when it works
Walk one hypothetical deal from purchase to refinance. You control every number below except the appraisal.
| Purchase price | $180,000 |
| Rehab | $40,000 |
| Closing and holding | $10,000 |
| All in | $230,000 |
| Expected ARV | $300,000 |
| Refinance at 75% of appraised value | $225,000 |
| Capital left in the deal | $5,000 |
You own a rented house with only $5,000 left in it, and you repeat with essentially the same capital. That is the pitch.
The math when one number moves
Now change a single input. The appraiser comes in at $265,000 instead of $300,000: same house, same rehab, same rent.
| All in (unchanged) | $230,000 |
| Appraised value | $265,000 |
| Refinance at 75% of appraised value | $198,750 |
| Capital left in the deal | $31,250 |
Six times the plan stays trapped in the deal, and the next purchase does not happen. One number moved, and the repeat step died.
The house is still fine as a rental; nothing about the property failed. The strategy failed, because the strategy was the velocity. If the sequence only recycles your capital at the optimistic number, you are not running BRRRR, you are betting on an appraisal.
Underwrite the appraisal before you buy
Since everything hangs on the appraisal, underwrite it like an appraiser before you offer.
Renovated comps only
Use comps close in size and condition to your finished product. That is the same set the appraiser will pull.
Be conservative on the exit
Run the sequence at your expected ARV and again at 90% of it. The deal has to survive both runs.
Verify the rent
Confirm it from achieved leases. The refinance lender will also underwrite the property's income.
Run a candidate address through the Deal Analyzer: check the renovated comps behind the ARV, then run the refinance math at 100% of that value and again at 90%. The second run is the one that tells you whether you can afford to be wrong.
Put this lesson to work on a live address.
Run the full BRRRR sequence on an address
