Estimating out-of-state flips

[Praveen Balaji]

I'm an out-of-state investor investing in Charlotte. I recently purchased my first SFH completely remotely. For my next project, I want to improve my cash flow with a flip. I would appreciate some advice from experienced out-of-state flippers about estimating rehab costs remotely.

I have a reliable real estate agent on the ground who help me with my first project. I also have some contractors that I'm speaking with that are experienced with investors and flips.

Before I get my agent and contractor to estimate costs of a property, I would like to have a system in place where I can make some reasonable go/no-go decisions at scale remotely. How can I efficiently estimate what condition houses might be? Should I speak with the seller agent and then compensate for their bias?

Thanks in advance for all your suggestions.

[Anson Young]

My advice would be to either pay your agent a set fee for initial opinion, and lots of pictures, or hire someone neutral to do this for you.  The only downside to the agent, is if you feel they are in it for the sale, turning your $50/100 property visit into a commission every time, or are they being honest?  You could also hire a BPO agent to do a mini appraisal and pics for you, it will cost a little extra however.

Estimating rehabs in another market can be tough, it comes down to experience and getting line item costs of things in that area.  You can start by having 3 contractors bid the same job, ask for detailed line item bid and see how they compare apples to apples.

Hope this helps!