How to Find Properties That Work for the BRRRR Strategy

What Makes a Good BRRRR Deal?

The BRRRR strategy works when you can buy below value, force equity through renovation, and refinance out most or all of your capital. For that to happen, you need a specific type of deal — one with a meaningful spread between your all-in cost and the after-repair value.

Not every property qualifies. Here's how to identify the ones that do.

The BRRRR Math Test

Before you spend time on inspections or contractor walks, run a quick back-of-envelope calculation:

1. 1Estimate the ARV (After-Repair Value) using comparable sales
2. 2Calculate your max all-in cost: ARV × 75% (assuming a 75% LTV refinance)
3. 3Subtract your rehab estimate from the max all-in cost
4. 4The remainder is your max purchase price

Example

• ARV: $260,000
• Max all-in at 75% LTV: $195,000
• Estimated rehab: $40,000
• Max purchase price: $155,000

If you can acquire the property at or below $155,000, you have a deal where you can recover all of your capital on the refinance.

Where to Find BRRRR Deals

On-Market Sources

• MLS — Look for listings with long days on market, price reductions, or distressed condition
• Auction sites — Foreclosure and bank-owned property auctions (Auction.com, Hubzu, local courthouse)
• HUD homes — Government-owned properties sold through designated brokers

Off-Market Sources

• Direct mail — Target absentee owners, pre-foreclosures, and inherited properties
• Driving for dollars — Look for vacant, distressed, or boarded-up properties in target neighborhoods
• Wholesalers — Build relationships with local wholesalers who bring you deals before they hit the market
• Networking — Real estate investor meetups, Facebook groups, and local REIA chapters

Property Characteristics to Look For

• Cosmetic distress — Ugly but structurally sound (paint, flooring, fixtures, landscaping)
• Below-market rents — Current tenant paying under market, or vacant and un-updated
• Estate sales / probate — Motivated sellers who want a quick, simple transaction
• Deferred maintenance — Needs work that most retail buyers won't take on

Red Flags to Avoid

Not every cheap property is a BRRRR opportunity. Watch out for:

• Foundation or structural damage that exceeds your rehab budget
• Environmental issues (lead paint abatement, asbestos, mold) in older properties
• Zoning or permit problems that prevent legal rental use
• Declining neighborhoods where ARV assumptions may not hold
• Over-leveraged deals where the spread is too thin to survive a market dip

Analyze Before You Commit

Use our BRRRR Calculator to model the full cycle — acquisition, rehab, rental income, and refinance — before you make an offer.

Talk to a Prime Advisor about your target market and deal pipeline.