Out of area and estimating repairs

[Sean Dezoysa]

Hi everyone;

I wanted to ask about repair estimates. Do you pay an agent, appraiser, or partner wholesaler to walk every property and build your estimates, or do you ballpark them?

Aaron Mazzrillo (who has done a BP podcast) ballparks all of his at $20/sf estimated repairs. He said in So Cal it's done very well for him despite being so basic. He does buy quite low (something like 52% ARV, in So Cal) so maybe some thin deals are also filtering out this way.

I've also heard you can just ask the seller for what needs fixing and ballpark the rehab as light/medium/heavy. A paint and sweep is around $3,000 to 5,000 in repairs. A moderate rehab is $10k to $15k. A big rehab is 25k to $40k. 

Curious what everyone else is doing when they don't or can't walk the homes themselves.

[Scott Forgue]

Hi Sean, ask the homeowner to provide bright pictures or videos of the home which is what we're doing, that should give you a good idea of the work. Depending on your exit strategy and the market area will help determine your repair costs, you will need estimates from a local contractor or handyman to be more accurate. $20/sf seems like a lower market area or minimal work like paint and carpet scenarios, not sure what Aaron is doing or where so don't want to comment on that too much. Knowing the market are is key since you need to know what rents are and values for your exit strategy and to help determine expenses and profit. Find other rei groups in the market area you're looking in and ask for referrals to help.