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BRRRR Calculator Canada
Buy, rehab, rent, refinance, repeat. With Canadian prices high relative to rents, the question is whether a refinance at 70–75% of ARV actually returns your capital. Run the numbers before you make an offer.
Educational calculators — always consult a licensed professional before making financial decisions.
What you pay for the distressed property.
Total cost of the renovation work.
What the property appraises for once the work is done.
Lenders typically cash-out refinance at 70–75% of ARV.
Gross rent once the property is stabilized.
Interest, tax, insurance, and utilities while the property sits empty.
Legal, title, inspection, and lender fees on the purchase.
Tax, insurance, maintenance, management, repairs. Exclude the mortgage.
Share of the year empty. ~5% is a common baseline.
Investment cash-out refinance rates run above owner-occupied rates.
25-year terms are typical in this market.
Post-Refi Cash-on-Cash Return
34.5%
$5,861/yr on $17,000 left in
Cash Left In The Deal
After The Refinance
Pre-tax figure. Assumes the appraisal supports your ARV and that you clear the lender's seasoning period before the cash-out refinance. Excludes income tax, appreciation, and principal paydown. Estimate only; consult a licensed professional.
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The BRRRR method for Canadian rentals
BRRRR stands for buy, rehab, rent, refinance, repeat. You buy below market value, renovate to raise what the property is worth, place a tenant, then take a cash-out refinance against the new after repair value (ARV) to pull your capital back out and fund the next deal. Everything in the sequence serves that last R — recycling the same money rather than tying it up one property at a time.
The number that matters is cash left in the deal: (purchase + rehab + holding costs + closing costs) − refinance loan amount, where the refinance loan is ARV × the lender's LTV. A cash-out refinance on an investment property is typically capped at 70–75% of ARV, and that ceiling is the whole constraint — if your project cost lands above roughly 75% of ARV, some of your cash stays trapped however well the renovation went.
Why the return goes infinite. Cash-on-cash return divides annual cash flow by the cash you have invested. When the refinance hands back every dollar you put in, that denominator hits zero: the property still pays cash flow, but none of your own money remains in it, so the return is mathematically infinite. That's the appeal. In Canada it lands less often than in cheaper markets — high prices relative to rents mean a 75% refinance covers a full project cost only when you have bought genuinely well and the renovation moved the appraisal.
Two things break these deals. The first is seasoning: lenders typically require a holding period — commonly in the 6–12 month range, varying by lender and product — before refinancing against appraised value rather than your purchase price. You carry the interest, property tax, insurance, and utilities through that entire window before any capital returns, which is why holding costs belong in the project total. The second, and the bigger one, is the ARV coming in below expectation. Every dollar the appraisal misses costs you the LTV share of it: at 75%, an ARV that lands $20,000 light leaves an extra $15,000 of your cash stuck in the deal. Use recent sold comparables for renovated properties nearby, never asking prices.
Check the refinance qualifies before you commit. Canadian lenders generally want a DSCR of 1.20–1.25 on an investment loan, and at Canadian price-to-rent ratios a fully leveraged refinance can fail that test even when the ARV supports the loan amount. Sanity-check the stabilized property on cap rate too — recovering your capital into a mediocre rental just means owning a mediocre rental for free.
How it works
Enter the buy and rehab
Purchase price, rehab budget, holding costs, and closing costs going in.
Estimate the ARV and refi
After-repair value and refinance LTV, plus the rate and amortization.
See the cash left in
Total project cost minus the refi loan — zero or less means your capital is fully recycled.
What makes BRRRR harder in Canada
| Factor | Effect on the strategy |
|---|---|
| Refinance capped at 80% LTV on 1–4 unit | Less capital recycled per deal |
| No CMHC insurance on investment property | No high-LTV insured refinance route |
| Compressed cap rates (~3.5–4.5% in Toronto/Vancouver) | Refinanced loan is harder to service |
| Federal stress test | Qualify at contract rate + 2% or the OSFI minimum |
Confirm current refinance LTV limits and seasoning requirements with your lender — they vary and change. Check the refinanced position clears DSCR before committing.
Frequently asked questions
What does BRRRR stand for?+
Buy, Rehab, Rent, Refinance, Repeat. You buy a property below market value, renovate it to raise its value, place a tenant, then take a cash-out refinance against the new after repair value (ARV) to pull your capital back out. Whatever cash you recover funds the next deal — the 'repeat' step. The strategy lives or dies on the gap between what you spend and what the property is worth once the work is done.
How do you calculate cash left in a BRRRR deal?+
Cash left in the deal = (purchase price + rehab + holding costs + closing costs) − refinance loan amount, where the refinance loan is the after repair value multiplied by the lender's LTV. If the refinance loan covers your whole project cost, the cash left in is zero or negative and you have recovered all of your capital. That number, not the purchase price, is what your post-refi return is measured against.
Why is a BRRRR return sometimes called infinite?+
Cash-on-cash return divides annual cash flow by the cash you have invested. If the refinance returns every dollar you put in, the denominator is zero and the return is mathematically infinite — the property still produces cash flow, but none of your own money is in it. That is the outcome the strategy is designed to reach. It depends entirely on the appraisal supporting your ARV, so treat it as a target rather than a forecast.
What LTV will a lender refinance at?+
70–75% of the after repair value is the standard assumption for an investment cash-out refinance, and it is the ceiling on how much of your capital can come back out. That cap is why BRRRR requires buying well below market: if your total project cost exceeds roughly 75% of ARV, some of your cash is stuck in the deal regardless of how good the renovation was. Confirm the actual figure with your lender before you commit.
What is the seasoning period on a cash-out refinance?+
Seasoning is how long you must own the property before a lender will refinance against the new appraised value rather than what you paid. Lenders typically require somewhere in the range of 6–12 months, though it varies by lender and loan product. It matters because you carry the holding costs — interest, tax, insurance, utilities — for that entire window before any capital comes back. Ask your lender for their seasoning rule before you buy, not after the rehab is finished.
What is the biggest risk in a BRRRR deal?+
The ARV coming in below expectation at the appraisal. Every dollar the appraisal misses costs you the LTV share of that dollar in refinance proceeds — at 75% LTV, an ARV that lands $20,000 low leaves an extra $15,000 of your cash trapped in the deal. Base your ARV on recent sold comparables for renovated properties nearby, not on asking prices or on what you hope the work is worth. Rehab overruns are the close second.
Does BRRRR work in Canada?+
The mechanics are the same, but the maths are tighter. Canadian investment properties require a minimum 20% down and cap prices are high relative to rents, so a refinance at 70–75% of ARV recovers a full deal cost less often than in cheaper US markets. The debt service test also bites harder: lenders typically want a DSCR of 1.20–1.25, and at Canadian price-to-rent ratios a fully leveraged refinance can fail that test even when the ARV supports the loan.
Got the capital back out? Run the next deal.
Back to the calculator ↑Cost ranges and rates here are checked against contractor quotes and published industry data. If a number still looks off, email Support@RealCostIQ.com and we'll review and fix it.