The BRRRR method — Buy, Rehab, Rent, Refinance, Repeat — is one of the most powerful strategies for building a rental portfolio with limited capital. Here's how it works in South Florida.
The BRRRR method — an acronym for Buy, Rehab, Rent, Refinance, Repeat — is one of the most efficient strategies for building a rental property portfolio with limited capital. The concept is straightforward: you buy a distressed property below market value, renovate it to improve both condition and rental income, place tenants, refinance based on the new appraised value (pulling out your equity), and use the returned capital to repeat the process on the next property. In South Florida, where distressed properties and value-add opportunities exist across all price points, the BRRRR method has made careers for countless local investors.
Breaking Down the BRRRR Acronym
B — Buy: Acquire a distressed property at a significant discount to its post-renovation value (ARV). Target properties where the purchase price plus renovation cost is no more than 70–75% of ARV. In South Florida, look for dated properties in strong rental markets — older Broward County SFRs, West Palm Beach workforce housing, or multifamily properties with deferred maintenance.
R — Rehab: Complete the renovation efficiently. The goal is not perfection — it's maximizing rental income and appraised value per dollar of renovation spend. Focus on kitchens, bathrooms, flooring, paint, and mechanical systems. In South Florida, add roof upgrades and wind mitigation improvements — these pay dividends on insurance costs and appraisals.
R — Rent: Place quality tenants at market rent before refinancing. Lenders underwriting a cash-out refinance want to see the property stabilized with a lease in place. South Florida's strong rental market — particularly in workforce housing segments — typically allows quick tenant placement at strong rents.
R — Refinance: After the property is rented and stabilized, refinance with a conventional cash-out loan based on the new appraised value. If you purchased and renovated correctly, the appraisal should come in at or above ARV, and you can pull out a substantial portion (typically 75–80% LTV) of the equity you created.
R — Repeat: Use the returned capital to fund your next acquisition and repeat the cycle.
The BRRRR Math: A South Florida Example
Purchase price: $180,000 (distressed single-family in Lauderhill)
Renovation: $45,000 (kitchen, baths, flooring, HVAC)
Total invested: $225,000
ARV (post-renovation appraised value): $320,000
Cash-out refinance at 75% LTV: $240,000
Capital returned: $240,000 − $225,000 = $15,000 net return
In this scenario, you've essentially bought and renovated a rental property for $15,000 out of pocket — and you now own an asset that cash flows while a tenant pays down your mortgage. That $15,000 plus any retained cash flow goes toward the next BRRRR property.
BRRRR Challenges in South Florida
The BRRRR method requires accurate renovation cost estimation and deal sourcing discipline. South Florida-specific challenges include:
- Contractor availability and cost: South Florida's construction market is active and prices are elevated. Budget conservatively and verify contractor quotes carefully.
- Insurance costs: Renovations that don't address roof and wind mitigation can result in uninsurable or extremely expensive properties. Factor insurance costs into your hold analysis.
- Appraisal risk: If the post-renovation appraisal comes in below your ARV estimate, the refinance loan amount decreases and you may be unable to pull out all your invested capital.
- Seasoning requirements: Many lenders require 6–12 months of ownership before a cash-out refinance. Plan your capital timeline accordingly.
Use our Fix & Flip Calculator to model your BRRRR numbers before committing to a deal, and talk to our team about active value-add opportunities across South Florida's six counties.
