How to Determine the Value and After Repair Value?

[Marshae H.]

Hey you guys,

I'm pretty new here and in the world of real estate, I happen to stumble across the website by accident in my research, but super glad I did. After all the knowledge gained overall about real estate, I know I'm looking to get started in wholesaling. So far I understand the basic concepts, how to get it done, I've also found contracts that I understand and I can use for motivated sellers and buyers. 

I'm struggling in finding resources on how to effectively and accurately calculate the value of property as well as AVR. I do know that I want to learn to do it on my own so that I can have an even greater understanding of this process. Can you all please advise on the resources and methods you use to complete these tasks? 

Last but not least, if you all know of any good books on wholesaling advise on those as well. Thanks in advance  :)

Marshae

[John Moore]

Hi Marshae - I can help a little - I Flip properties in San Antonio and Austin areas and I'm  also a licensed RE agent (in Texas) and I perform what are called Broker Price Opinions (BPO's). 

when you are trying to determine the actual ARV of the house, you want to look at similar SOLDS  in the area (start with the neighborhood, then expand to the same "area")- as much as possible when we do BPO's we try to constrain our comps to homes that have sold in the last 6 months and that are within .5 miles. However if there aren't enough comps that fit those constraints (usually we want to find at least 5 or 6 similar comps) then we have to either expand the search area or the period of times (but no more than 1 year) when Im performing an unofficial BPO (aka ARV) for myself or an investor friend/client I will include pending properties. It is ok to look at the homes that are active just to see what people are asking for, but I wouldn't use them for an actual ARV determination. You wan to know what people are actually willing to pay for a home and the only way to do that is to look at sold properties. Redfin is a good source for solds but it can be a little tricky getting the settings to work just right sometimes. I have also seen times when it didn't list some properties that I knew had in fact sold, so it may not be as complete as the actual MLS.

Through my system, I have access to most MLS systems in the country so if you want to practice with one, message me with the address and zip and we can play with it some to compare notes.