The BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat) is a real estate investment strategy that involves purchasing distressed or undervalued properties, renovating them to increase their value, renting them out to generate income, refinancing the property to extract equity, and then repeating the process with the extracted equity to purchase additional properties.

Here’s how it works:

1. Buy: The first step is to find a property that is distressed or undervalued, and purchase it at a price that allows for a potential profit.
2. Rehab: After acquiring the property, the next step is to renovate it to increase its value. This can involve making cosmetic improvements or major renovations, depending on the condition of the property.
3. Rent: Once the property is renovated, it’s time to find tenants and start generating rental income. This helps cover the ongoing costs of the property, such as mortgage payments, taxes, and maintenance.
4. Refinance: After the property has been rented out for some time and has appreciated in value, the investor can refinance the property to extract equity. This involves taking out a new mortgage for more than the remaining balance on the original mortgage, and using the difference as cash.
5. Repeat: With the extracted equity, the investor can purchase additional properties and repeat the process, building a portfolio of rental properties that generate ongoing income and appreciation.

The BRRRR strategy can be a powerful way to build wealth through real estate investing, but it does require careful research and planning to ensure that each step of the process is executed effectively.