Help Assessing a Deal

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Hello BiggerPockets community!

My brother and I have finally decided to take action and look at properties around our area (South Austin, TX.) We found a property that we plan to rehab and we think it has good potential for a high ARV. We have not looked at the interior of the house but we found some issues on the exterior. However, we are not sure if they will cost us a lot to fix. For the experienced flippers out there, would you guys recommend hiring a GC or home inspector to help us assess the future costs? Or how do you guys first go about calculating the numbers?

We hope that you guys can help us as we are eager to obtain our first deal! We appreciate the support.

[Atif F Shahnawaz]

Ivan Huerta
Hey Ivan, I'm very new to real estate investing and all of my knowledge thus far comes from books, podcasts and forums, so keep that in mind reading forward.

My plan too, as my first real estate investment in the Austin market, is to find and rehab a property. I understand however that the market in austin is pretty hot and a true deal (a fixed upper with good ARV potential) is not going to be on the market long. So if you really have a property like this, unless your the only investor aware of the property, you should expect others to make moves on it as well.

With that in mind, being green myself, I would never buy my first property unless I had an accurate assessment of what the rehab costs would be. That means going inside. I'm hoping that by spring of next year, I'll have networked enough to know 3 or 4 well regarded general contractors and will get all of them to look at the place and give me their estimated rehab costs with a well defined scope of work. By that time, I'm hoping to also have met and befriended (hey! I'm a friendly guy! 😁) some folks experienced in rehabbing who's brains I can pick when issues arise. I'll also have a real estate lawyer, and an account lined up as well as a property management company (because I don't want to manage it myself).

I still have a lot of these pieces to put together before I jump in. Perhaps you have all the above worked out already.

Best of luck and keep us updated on your progress!

Atif