Changing Neighborhood Sales Prices

[Sean McKie]

Greetings All, I have a property that I am working on a full gut in Baltimore City upside down deal but it's going to be my personal residence, I have a opportunity to purchase 2 additional properties on the same block of houses. Same size and style exact match. Wondering how my rehab will directly effect the block of houses that is currently 75% occupied.

[Jamal L.]

@Sean McKie

Hey Sean, the purchase of your property may be added to the recent homes sales in the area. Depending on that price and the price you are looking to sell the other properties for once rehabbed and in-conjunction with similar sales prices in the area, you can create your the ARV for the block.Ex: Assuming your house is being purchased at $179k similar sales in the area are $165k. The purchase of your home at a higher rate drives the ARV of the area up slightly. Therefore if you do a rehab on one around the same level of your home, your property can be used as a viable comparable that individuals are willing to pay to move in the area.

Hope this helps... Prosperous investing.