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It may be easy to confuse with a sound you make when the temperature levels drop outside, however this slightly weird acronym has nothing to do with winter weather condition. BRRRR means Buy, Rehab, Rent, Refinance, Repeat. This approach has acquired quite a bit of traction and popularity in the realty neighborhood over the last few years, and can be a clever method to make passive income or build an extensive investment portfolio.

While the BRRRR approach has numerous actions and has been improved for many years, the principles behind it - to purchase a residential or commercial property at a low cost and increase its worth to construct equity and increase cash flow - is absolutely nothing brand-new. However, you'll desire to think about each action and comprehend the disadvantages of this technique before you dive in and commit to it.

Advantages and disadvantages of BRRRR

Like any income stream, there are advantages and downsides to be mindful of with the BRRRR technique.

Potential to make a substantial amount of money

Provided that you're able to purchase a residential or commercial property at a low sufficient cost which the worth of the home boosts after you lease it out, you can make back far more than you put into it.

Ongoing, passive earnings source

The primary appeal of the BRRRR approach is that it can be a relatively passive income source