BRRRR Calculator — Buy, Rehab, Rent, Refinance, Repeat — and Flip ROI

Model a value-add or BRRRR redevelopment. Compare cash-out refi versus fix-and-flip exits.

Exit strategy

Current value / acquisition price

Renovation / construction cost

After-repair value (ARV)

Use comparable sales (Zillow, Redfin, MLS) for completed similar properties.

Holding costs (interest, taxes, utilities)

Refi LTV

Investment property cash-out: typically 70-75%.

Selling costs (if sale)

Agent commission + closing + concessions.

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How to use

1 Enter the current property value (purchase price) and renovation cost.
2 Enter the After Repair Value (ARV) — the comparable sales price for similar fully-renovated properties in the area.
3 Enter holding costs during renovation (mortgage interest, property tax, insurance, utilities — typically 3-6 months).
4 For BRRRR (refi exit): enter the LTV percentage your refinance lender will allow (typical 70-80%). For Fix and Flip (sale exit): enter selling costs percentage (typical 6-10%).
5 Click Calculate to see total cost, ARV, value created, ROI, and 70% rule pass/fail. For BRRRR, the goal is $0 cash left in deal — refi recovers your full investment.

The 70% Rule

The most important screening metric in BRRRR and flipping: All-in cost ≤ 70% × ARV. So a property with ARV of $300K can have all-in (purchase + rehab + holding) up to $210K. The 30% margin covers selling costs, financing costs, profit, and unforeseen overruns. Failing the 70% rule means thin margins — risky for new investors.

BRRRR Strategy

Step	Action	Goal
1. Buy	Acquire below-market property	Distressed, REO, off-market deals
2. Rehab	Strategic value-add improvements	Maximize ARV per dollar spent (kitchens, baths, curb appeal)
3. Rent	Place quality tenant	Establish rental income for refi underwriting
4. Refinance	Cash-out refi at 75-80% of ARV	Recover all cash invested ("infinite return")
5. Repeat	Use recovered cash for next deal	Scale portfolio without adding new capital

Fix and Flip vs. BRRRR

	Fix and Flip	BRRRR
Exit	Sell after rehab	Refinance and rent
Holding period	3-6 months	6+ years (rent indefinitely)
Tax treatment	Ordinary income (dealer property) or short-term capital gain	Long-term holds get LTCG, depreciation, 1031 exchange
Cash flow	Lump sum at sale	Monthly rental cash flow
Best for	Active income earners, hands-on remodeling	Long-term wealth building, portfolio scaling

2024 Fix and Flip US Statistics (ATTOM Data Solutions)

Metric	2024 value
Total flips (annual)	~232,000
Average flip purchase price	$220,000
Average flip resale price	$286,000
Gross profit per flip	$66,000
Gross flipping ROI	~30%
Net ROI (after rehab/financing)	~10-15%
Average days held	165 days

Common BRRRR Pitfalls

(1) ARV overestimation — get 3+ recent comps from MLS, not Zillow Zestimate. (2) Rehab budget overrun — average 20-30% over original budget per BiggerPockets community surveys. (3) Refinance underwriting tightening — banks may require 6-12 months seasoning before cash-out refi. (4) Renting underperforms — vacancy, repair calls, bad tenants. (5) Interest rate timing — locked in low purchase rate, refi at much higher rate kills the deal. Always model conservatively.

FAQ

Q What is the BRRRR strategy?

Buy, Rehab, Rent, Refinance, Repeat. Popularized by BiggerPockets. Buy a distressed property below market, renovate to add value, place a tenant, then cash-out refinance at 75-80% of After Repair Value (ARV). The refi recovers your initial cash, letting you repeat with another deal — scaling a rental portfolio with limited capital.

Q What is the 70% rule?

All-in cost (purchase + rehab + holding) should not exceed 70% × ARV. So an $300K ARV property allows up to $210K all-in. The 30% margin covers selling costs (8-10%), financing costs (3-5%), profit (12-15%), and overrun buffer (5%+). Failing the 70% rule means thin margins.

Q How much profit do flippers make?

ATTOM Data Solutions 2024: average gross profit $66,000 per flip on $220K average purchase / $286K average resale. Gross ROI ~30%; net ROI (after rehab and financing) ~10-15%. Average holding period 165 days. Significant variation by market — Atlanta, Phoenix, Tampa profitable; many California cities marginal.

Q What does ARV mean?

After Repair Value — what the property would sell for after renovation, comparable to similar fully-renovated homes in the area. Calculate using 3+ recent MLS sales (within 6 months, within 1 mile, similar size and condition). Don't use Zillow Zestimate — Zestimate accuracy is ±5-10% which is often the entire margin of a flip.

Q How long do I need to hold before refinancing?

Most US banks require 6-12 months "seasoning" before cash-out refinance. Some BRRRR-friendly lenders (small banks, credit unions) allow refi after 3-6 months. Delayed financing exception (Fannie Mae) allows refi within 6 months for cash purchases. Plan financing strategy upfront.

Q How are flips taxed?

Generally as ordinary income (10-37% federal + state) treated as inventory if you're a "dealer" — short hold, multiple flips. Some courts have held single flips as long-term capital gain (15-20%) if held over 1 year. IRS scrutinizes flipping closely. Talk to a CPA familiar with real estate before completing your first flip.

Q What's the difference between hard money and conventional loans for flips?

Hard money: 8-15% interest, 1-3 points, 6-12 month terms, 80-90% of LTC + 65-75% of ARV. Fast (close in 5-10 days), but expensive. Conventional: 6-7%, 30-year terms, much cheaper but slow (45-60 days) and require borrower qualification. Most flippers use hard money for acquisition, refi to conventional for BRRRR.

Q Can I BRRRR with no money down?

Difficult but possible. Strategies: (1) Hard money 100% acquisition + 100% rehab funding (rare; requires 80%+ ARV margin and proven track record). (2) Partner with a money partner for acquisition. (3) Seller financing with creative deal structure. (4) BRRRR your primary residence (live-in flip after 2-year Section 121). Most new investors put 20-25% down on the first deal.