Podcast Summary: Radical Wealth Plan

Episode: Why the BRRRR Method Still Works in 2026 (If You Do This)
Host: Paul Morris
Date: January 12, 2026

Episode Overview

In this episode, host Paul Morris addresses the pressing question facing many real estate investors in 2026: Is the BRRRR method—Buy, Rehab, Rent, Refinance, and Repeat—still viable in today's higher-interest, less forgiving market? Bucking conventional wisdom, Paul argues that the BRRRR strategy can absolutely still work if investors adapt to new market realities and exercise stricter discipline. He breaks down the shifts in the real estate landscape, essential rule changes, and actionable advice for success in the current environment.

Key Discussion Points & Insights

1. Setting the Stage: Is the BRRRR Method Dead?

Timestamps: 01:19–03:10

• Paul addresses the skepticism around the BRRRR method in 2026, acknowledging widespread doubt among experts.
• Stresses that the advice given is for educational purposes—consult professionals before acting on any investment.

2. The Three New Realities in 2026

Timestamps: 03:11–08:05

• A. The Cost of Money

  • Interest rates have doubled from ~3% (2020) to over 6% (2025–26).
  • “The cost of money is very important in a BRRRR deal, and that cushion of a 3% cost of money is totally gone.” (Paul Morris, 03:30)
  • Investors can no longer count on cheap debt to juice returns.

• B. Stagnation of Rent Growth

  • Rental rates are no longer reliably rising year-over-year; past assumptions of ever-increasing rents no longer hold.
  • "I never underwrite appreciation in a property. I never underwrite increased rents based on doing nothing..." (Paul Morris, 06:20)
  • Future projections should not bank on rent inflation unless true value is being added.

• C. No Built-In Appreciation

  • Do not underwrite deals assuming property values will automatically increase.
  • "Every time I see a pro forma that’s taking into account increased appreciation, I write that totally off. If writing that off makes it a deal not worth doing, I'm not doing the deal." (Paul Morris, 07:45)
  • Deals must be solid based on stable or conservative appreciation/rent estimates.

3. The Five Essential Adjustments for BRRRR in 2026

Timestamps: 08:06–17:45

Paul outlines five recurring mistakes and how to avoid them in the current cycle.

• 1. The Margin Break: Buy It Right

  • Most vital rule: "You gotta make money on the way into the deal."
  • Tighter margins mean execution risk is higher; relying solely on skilled execution isn’t enough.
  • "I actually believe that there are more opportunities in 2026 to buy something right than there were in the years before...that’s going to be a tremendous discount." (Paul Morris, 10:25)
  • Distressed sellers with low-rate legacy debt create new buying opportunities.

• 2. Rehab Realism

  • Always build in at least 10–20% more time and cost on rehabs.
  • "I'm always building in at least a 20% additional cost for it's going to take a little longer. It's going to cost a little bit more. That wipes out the entire profit for the old BRRRR method." (Paul Morris, 12:55)
  • Passing on slim deals is safer than risking budget overruns.

• 3. Stable Rent Assumptions

  • Underwrite deals with stable (not growing) rents unless value is being added through upgrades.
  • "I'm not underwriting as if rents are going up. Rents might go up...But it's not based on the rental market going up. It's based on that particular property. You're improving it." (Paul Morris, 14:10)

• 4. Lending Conditions: No Guaranteed Refi

  • Cash-out refinances are tougher to execute due to stricter lending standards and higher rates.
  • “Don’t count on [the refi] as a guarantee...definitely not how I’m viewing this.” (Paul Morris, 15:40)
  • Focus on the buy, rehab, rent—and treat refi as a strong possibility, not a certainty.

• 5. Lower Velocity: Can't Count on Full Cash-Out

  • Don’t assume you'll get all your invested cash (or your investors’ cash) back during refi; adjust investor expectations accordingly.
  • “You cannot count on that. So as long as you're not counting on that...each one of these things takes you right back to the first rule: buy it right.” (Paul Morris, 16:55)

4. Final Recap and Motivation

Timestamps: 17:46–19:05

• BRRRR isn’t dead—but it requires stricter underwriting and discipline than ever before.
• "Done right, the BRRRR method is still alive and well in 2026." (Paul Morris, 18:05)

Notable Quotes & Memorable Moments

• "You gotta make money on the way into the deal." (Paul Morris, 10:15)
• "The cost of money is very important in a BRRRR deal, and that cushion of a 3% cost of money is totally gone." (03:30)
• "I'm not underwriting as if rents are going up...It's based on that particular property. You're improving it." (14:10)
• "Done right, the BRRRR method is still alive and well in 2026." (18:05)

Timestamps for Key Segments

• 01:19 — Introduction: Is BRRRR dead in 2026?
• 03:11 — The three new market realities
• 08:06 — The five critical mistakes and how to correct them
• 17:46 — Final advice & recap

Takeaways for Listeners Who Haven’t Tuned In

• BRRRR is not dead, but it's not business as usual: the era of automatic returns from rising markets is over.
• Success in 2026 is about buying distressed assets at genuine discounts, planning for realistic project overruns, and resisting the urge to project appreciation or rent growth beyond value-added improvements.
• Paul's recurring mantra: buy right, be conservative, and recalculate for the new lending and economic realities before attempting the BRRRR method this year.

If you want to keep up with evolving real estate strategies, adapt to the times, and are willing to do the work, Paul’s analysis shows there’s still room for wealth creation through BRRRR. Just make sure you’re sharper than ever, and never forget to buy it right.

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