Rehab Cost's on the Fly

[Tom Scott]

So, I keep reading how it is such a great strategy to come to a showing with a contract in hand and I agree it probably is. My question though is how do you come up with an offer price right there on the spot? Obviously you have ARV ahead of time and you know the max you can pay based on the 70% rule but how do you figure repair costs on the fly? I have read J Scott book and have created a great spreadsheet based on the categories he uses. The spreadsheet works great, but it's a bit impractical to set up on the kitchen table (if there is one) with my laptop and spend 20 minutes punching in every little thing. I know some of you guys have streamlined this process a bit to get a good preliminary number so you can make an offer on site, I just am not sure how? Do you just give everything a flat number per square foot? Do you just figure a flat figure that covers a traditional renovation (i.e. new floors, paint, appliances, cabinets, counters, baths etc.)? Perhaps a cost per type of room (i.e. $15k for a kitchen or $8k per bathroom, etc.)?

The ultimate goal is to come up with a spreadsheet that I can load on an ipad and edit as I go but for now I am sticking with a pad and paper. Any advice is greatly appreciated. 

Tom

[Andrew Cordle]

@Tom Scott

Hey Tom, 

What you are going through is a very good question. And @Curt Davis is right that it really just comes over time by doing flip after flip after flip. But in the mean time this little postcard we built is pretty cool to help the investors at the beginning stages. 

Basically, it is a 4 by 6 postcard that can fit in your back pocket and you can simply check check off each little box that you will have to do. 

Now if you can see there are a couple different sections it starts with Exterior and Interior. Then across the top there is a line that says 1,000 2,000 and 3,000sqft. So you can simply fit your house in one of those categories then check off what you need to do to the house. 

The prices are for labor and materials that we use form our guys. Also at the bottom there is a place to add up the totals and even add 10% for extras. 

Lastly, these are NOT GUARANTEED numbers they are suppose to be just guidelines that you can use to help you get a quick educated estimate. 

If you want some just let me know and I can see if I can get you one. 

Andrew