Best Rehab Estimate Techniques

[Colin Carey]

Hi Everyone! I'm just getting started in my real estate career and one area I want to improve on quickly, is rehab estimation costs as well as the added value from it. I am not a contractor by any means and I understand no contractor is going to walk a property, or multiple properties for that matter, to estimate your costs without the real intent of purchasing. I have used the estimator on the site and it just seems to be not detailed enough along with a black box around where the numbers actually come from. This is more so a quick estimate to evaluate if value can be added to a property, not the full due diligence needed towards final stages of closing. Thank you for any and all advice!

[Nicholas L.]

@Colin Carey

it just has to be a line item, bottoms up estimate every time.  and it seems intimidating until you've done it.  you just have to make the actual list of what the property actually needs - roof, furnace, doors, windows, bathroom gut, interior paint, exterior paint.  carpet, floor.  light fixtures.  electrical.  appliances.  landscaping. concrete repair.  whatever.   how many doors?  how many windows?  what kind of countertops?  how much landscaping?  how long will the water heater last?  deep clean or can you clean it yourself?  roof repair or replacement?

go to home depot and take some notes. go to REIA meetings and find some contractors or some investors who do rehabs and ask them. read BP threads on specific items - bathroom or roof. make your own estimator for your area. it doesn't have to be perfect, but it has to get you in the ballpark.

on my first big rehab i overestimated a few things and underestimated a few, and was pretty close.  i only overlooked one big ticket item - basement water remediation for 8k.  lesson learned and i made sure to include that in the next one.

i benefited a lot from meet kevin's early YouTube content and also anything with Tarl Yarber doing a flip or a BRRRR. they both go way into the details of their rehabs.

hope this helps - ask any follow up questions you have