how to figure repair costs and arv

[Dennis Knapp]

im new to BP and BP Pro but excited to start my REI career. I seen somewhere where there is a list of how to figure rehab costs but i cant find it. can someone help me please? also how do i know what the arv is? do i just figure out high comparables? Thanks so much, Denny

[David Martoyan]

Hi Denny,

Welcome to BiggerPockets and congrats on starting your real estate investing journey! Rehab costs and ARV (After Repair Value) are key parts of evaluating deals, so it's great that you're diving into these concepts early.

For rehab costs, creating a rough estimate starts with understanding the scope of work and local pricing for materials and labor. 

• Light Cosmetic: $25-$40 per sq. ft. (e.g., paint, flooring)
• Medium Cosmetic: $40-$60 per sq. ft. (e.g., kitchen and bath updates)
• Heavy Rehab: $60-$85 per sq. ft. (e.g., major systems like plumbing/electrical)
• Full Gut/Studs Down: $85-$120 per sq. ft.
• Luxury Finishes: $150+ per sq. ft.

For ARV (After Repair Value), you're absolutely right—it's all about comparable sales ("comps"). Look at recently sold properties in the same neighborhood that match the size, condition, and style your property will have post-rehab. Platforms like Zillow, Realtor.com, or even tools provided by BiggerPockets can help. However, having an experienced real estate agent or investor in your network analyze comps adds an extra layer of confidence.

If you’re focusing on specific markets and ever want to discuss analyzing deals or strategies, feel free to connect, Our firm would love to help you! Wishing you the best in your investing journey.

Best Regards, 

David.