BRRR
Buy, Refurbish, Refinance, Rent: a strategy where you add value through refurbishment, then refinance at the higher value to pull capital back out for the next purchase.
BRRR aims to recycle the same pot of capital across multiple purchases. Buy below market value or with clear improvement potential, refurbish, get the property revalued, then remortgage against the new value to release most of the cash you put in.
The numbers that matter
- All-in cost: purchase price plus refurbishment, fees, and finance costs.
- End value (GDV) and end rent: what the property is worth and lets for after works.
- Capital left in: all-in cost minus what the refinance releases. This is the real measure of a BRRR deal. Zero money left in means infinite return on capital employed; more commonly some capital stays in the deal.
The refinance is constrained twice: by the lender's maximum LTV (commonly 75% for BTL) and by the rent, which must support the new loan under the lender's ICR stress test. Plenty of deals that "work" on value fail on rent.
Where BRRR goes wrong
Optimistic end values, refurb overruns, down-valuations at refinance, and bridging costs running longer than planned. Model the deal with a conservative end value and a realistic works timeline before committing; our BRRR calculator is built for exactly this.