How do we estimate what repairs are going to cost?

[Brian V.]

I"m just getting started, and I'm really interested in the BRRRR method. Let's say I find a distressed property that needs work done. I need to know the cost of this work in order to make a proper offer and see the price I can get justifies the repairs. In other words, how do I make offers if I personally don't know how to estimate the costs of a rehab?

[Doug Spence]

In the OKC market, I use $20/sq ft for only cosmetic repairs, and $40/sq ft for a full rehab. That gets me close enough to make a rough guess. Then I just get the property under contract and get a thorough inspection which will give me a much better estimate of the necessary repairs. Putting a property under contract just shows intent to buy, not that you will buy for that price. Your agent should work in some due diligence clauses to cover you and allow you to back out if you find more than you bargained for in the inspection. Best of luck!