How to properly comp properties

[Torian Hollins]

Hey how’s it going I was wondering are there any appraisers or cash buyers who work with wholesalers that truly know the Detroit market, or one vey similar. What people are actually paying in these neighborhoods, and understand how to comp properties.?.


I don’t want to waste anyone’s time when I send offers.. I’m a wholesaler myself  and I am still trying to perfect this aspect of my learning process. I know it’s all too common that most wholesalers submit deals to low or to high based off of formulas that don’t necessarily work for a property or they have received bad advice. 

[Christian Hutchinson]

So here is my assessment and experience.

The market value of the property meaning what it will sell for not what the bank will appraise it runs like this:

Some baseline number that it costs to get into an area. Then the total costs of what it takes to bring it to livable condition or rentable condition. Then tack on 25%

So say you bought a property in East Village for $70K. To rehab the property is $60K So that is $130K.  You can sell it on the open market for $162K.

How do you establish a 'baseline'? Well check the prices of Land, Shell Houses, Homes requiring work, and Homes that are in good condition. 

Go to the selected neighborhood via Zillow, and look to see what the condition is via the picture, compare the price.  Then cross-reference sales in the Detroit Land Bank.  To determine the cost of rehab look what the Land Bank says and the scope of work and determine your scope and costs.