So, what is the BRRRR method anyway? To get started, it’s important that you fully understand what the BRRRR method actually is. To put it simply, this method uses a buy, repair, rent, refinance, and repeat system that allows you to invest in (and profit from) real estate properties without the need for harsh initial investments.
At first, you buy a rental investment property at a below-market value rate. You achieve this by looking for properties that embody the “fixer-upper” spirit. You then make any repairs that are needed to make the space liveable ASAP, so you can begin paying for your investment (and generating passive income) via rental fees. After you’ve completed restoring the property, and making its equity value high, you can refinance to earn a huge windfall of cash. Then, you simply repeat this ingenious BRRRR method of real estate investing to provide you with a financial cushion.
5 Pros of Using the BRRRR Method in 2023
The better you are at using the BRRRR method, the greater your ROI will be. Thankfully, even those who are first-time real estate investors, or who are barely experienced, can use this method with ease. There are five pros of using the BRRRR method that makes this the case:
1. It’s Great for First-Time Investors
Many people fail to get into real estate investing because they assume that it’s both too difficult and too expensive. Thankfully, the BRRRR method has become one of the most accessible and lucrative methods of making money in the real estate game. And one that anyone can take part in. Because you’ll be investing in properties of below-market value using the BRRRR method, you get to make money without needing a ton of cash to invest right away. The mixture of using rent from the property, refinancing, and other tools to create a massive ROI on your investments is at the heart and soul of the BRRRR method, after all. BRRRR also does wonders for boosting your credit score in a quick, efficient manner.
2. Achieving the “Economies of Scale”
One of the key qualities you should be aiming for with any sound investment method is what’s referred to as “economies of scale.” Investors who use the BRRRR strategy are often already familiar with this term, in fact. This allows you to both own and operate multiple rental investment properties at the same time and can ensure you’ve got extra financial collateral and passive income to ensure your investments remain a success. As we mentioned earlier, the highly repeatable nature of using the BRRRR method is one of its key appeals. After all, since you’ll be using a method that makes it much simpler to begin owning and flipping multiple properties, you’ll have a much easier time achieving the core goal of having an “economies of scale” as well.
3. You Can Quickly Build Equity
Building up an impressive amount of equity into your investments is another main goal and one that is well-facilitated by the BRRRR method. The rehabilitation phase we discussed in our description of BRRRR earlier on is the key way that you’ll build quality equity. Passive income is one of the best ways to ensure you lead a comfortable and financially satisfying life, and the BRRRR method can help you achieve this goal fast. As you get better at using, maintaining, and understanding the ins and outs of the BRRRR process, you’ll get better and better at building up equity quickly as well.
4. Attract Excellent Tenants with Ease
Tenants love properties that are reasonably priced. But they love properties that they can rent at a lower-than-expected rate even more. As long as you can find tenants who don’t mind the more short-term nature of BRRRR-involved properties, and who will allow you to do additional equity building with ease, you’ll have a breeze of a time gaining passive rental income from your BRRRR property. Every real estate investor is on the lookout for quality, agreeable tenants, and every tenant is on the lookout for a good deal. By using the BRRRR method, everyone wins.
5. It’s a Reliable Money-Making Method
Since you’ll now have a solid, consistent source of income, the BRRRR method will give you the financial cushion you need to lead a satisfying life. After all, you want to live off of the money you’ll make via the BRRRR method if you can. The more frequently you use the method successfully, the more ROI you’ll bring in. For those who don’t mind a little groundwork, the BRRRR method is one of the best ways to finally get rich in 2023. Do yourself a favor and use the BRRRR method to kickstart your dream life today.