Calculator question; Newbie!

Homestead, FL · Member since 2019 · 59 posts · 24 votes

Hey BP! So I am looking around for homes where I see the possible potential... But I am having issues with the order of the steps I need to take since I have never purchased a home before. Okay, so say I find a home that I like and I am working on the analyzing portion of this potential deal but then I come across the ARV portion of the calculator and other estimates on the calculator... Should I be pre-approved before calling contractors, agents, or even analyzing anything? I hope this question makes sense. I have all of these steps mixed up in my head when I practice with the calculators. I've seen how Brandon Turner will sometimes estimate repair costs, etc using his experience but I have none and I wouldn't know how much it would cost to paint the interior/exterior of a house for instance. Thank You in advance.

0 Reply

20 views

3 Replies

Jump to latestLatest

Sort by

Jonathan K.
Wholesaler · Los Angeles, CA · Member since 2018 · 41 posts · 16 votes
6y
Hi Evelyn,
So there's no particular order to the process. What I've heard from most of these podcasts it's about creating your own process. But to start you want to
1. Educate yourself on a specific market
2. Once you decide that's the place you want to invest you start analyzing deals within that area
3. You can begin getting pre-approved in whatever area you chose so that once you find a deal you're ready to move on it quickly
4. For contractors and all that you can contact whenever you'd like, but you'd probably want to wait until you have the property before you get exact quotes. If you're looking for general estimates you can use google or call local agents, contractors etc.
I did a quick google search on how much it costs to rehab a house and saw this
I'm no expert by any means, but just trying to help out! Hope this helps!
0 Reply
Steven Le
New to Real Estate · Fort Worth, TX · Member since 2020 · 21 posts · 8 votes
6y
Going off what Jonathan said, google and estimate it as best as you can. I just started practicing analyzing properties as well, but haven't touched ARV. Been looking at mostly places that don't look like they need repair. If that's the case, you'd put the ARV as the same as the purchasing price
So many books to read, but I think one of the next ones I'm going to read is the one recommended by Bigger Pockets on estimating rehab costs. Hopefully it'll help me get a better idea

I also feel like its pretty hard to estimate ARV if you can't see the property yourself, seeing how most photos listed are sub par

Good luck
0 Reply
Guifre Mora
Lender · San Diego, CA · Member since 2019 · 874 posts · 355 votes
6y
Originally posted by @Evelyn Castillo:
Hey BP! So I am looking around for homes where I see the possible potential... But I am having issues with the order of the steps I need to take since I have never purchased a home before. Okay, so say I find a home that I like and I am working on the analyzing portion of this potential deal but then I come across the ARV portion of the calculator and other estimates on the calculator... Should I be pre-approved before calling contractors, agents, or even analyzing anything? I hope this question makes sense. I have all of these steps mixed up in my head when I practice with the calculators. I've seen how Brandon Turner will sometimes estimate repair costs, etc using his experience but I have none and I wouldn't know how much it would cost to paint the interior/exterior of a house for instance. Thank You in advance.

Start a plan are you flipping, buying and holding, fix and hold?

Second, with a budget (Downpayment, closing costs, holding costs, rehab budget). What's the point of all the calculations if you cant afford it.

Third, how are you going to finance the project: HM, Private loan, your funds etc... build a relationship with a lender that can get you financed. A newbie will find that they are not being funded for lack of experience.

Fourth, focus your attention on a market and learn to do comps.

Fith, build a relationship with a GC, they can really quickly give an estimate on what's needed to get it up and running, that's how you learn. They are also hustling to get work and build a relationship.

Good luck and keep learning!!
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.