Rehab Estimates: Square Footage Multipliers in Dallas

[David Ramsey]

Hi BP Dallas!

I'm brand new to REI and starting to practice analyzing deals for single family flips. My biggest struggle so far is coming up with rehab estimates. I know a general rule of thumb in $5/SF for light, $10-15/SF for medium, $25/SF for heavy, but I'm curious how or if this skews in the DFW market.

Hoping some of you wouldn't mind sharing the square footage multipliers that you use. Just looking for quick and dirty estimates for now, but I'm definitely open to recommendations on other methods to get more specific numbers. I accept any and all advice!

Thanks so much!

David

[Ashley Hust]

Hey David!

I actually like to approach it the same way as Maurice. Ideally, if you're close with your contractor I would bring him along to showings to mentally tally a rough estimate of cost together (he may see red flags you don't and vice versa). If not, I always like to be prepared with "bucket costs"  ie) a mid-level kitchen reno (15k-20k), bathroom rehab (10k), basic pricing for floors based on sq foot, etc. That way, when you walk the property you can add it as you go. 

As for figuring wether a property is worth further analyzing, definitely run your numbers to determine how much you're willing to put in, and what your goal is for the return. It'll be pretty clear if a property is a good possibility when you have that bottom line in mind while walking properties.

Would love to chat more about it if you want to connect!