All Forum Posts by: Corbett Brasington

But that is the nature of the question. What is enough to make it worth while.   Making 20k on a 6 month flip with 3 months on market to close does not seem with it, especially in a market in the state it is in. 

I am asking this question for two reasons:

1.  Is this what a healthy project looks like to a GC?  Markup recommendations are all over the place from 20% to 67% and I don't know what is reasonable.  I don't want to deal with contractors that need me to float their working capital with large deposits.  I want contractors who have enough markup and a proper payment schedule to reduce the upfront load to me (allows me to scale more).  

2.  Finding reliable "how to estimate repair costs" has been a roller coaster with how much the cost of things have changed.  I have no heard that cosmetic rehabs are $30ppsf and full guts are $60ppsf and new builds are $125ppsf, I don't know what to trust.  I want to create my own templates for scope of work with real numbers from a big box store.  If the 1/3, 1/3, 1/3 is reasonable I can take the entire cost of materials for the whole house and back into the cost of hiring a GC.  

For those of you who have an active business doing this what is your minimum profit for a flip vs its not worth the time or investment to flip and you would rather whole sale it?

Said another way...how to you choose if its worth it to flip rather than wholesale it?

Wondering how everyone else is doing this.  If you follow the book "how to estimate rehab costs" its says to call certain trades to get estimate baselines for simple things..... but when materials and labor are increasing crazy fast to keep up this would be doing this with all 25 trades once a quarter.   I am not a heavy hitter in flips at this point, just doing my first one but what I have seen in the last 2 years is:

2021 : 2023 prices

- Concrete Peirs $350 per, now $550 per

- Sub Flooring: $8 per sheet, now $24 per sheet

- Reshingle a Standard Gable roof:  $8k, now $11k

I could continue with more examples, but how are you all keeping up with the price updates so your rehab estimates are not grossly wrong?

How often are you updating your templates?

You can do both. You can rent it and take a HELOC.

I have a home I am considering where there are a lot of recently sold 1 stories but no 2 stories sold in the last 6 months. So I needed a way to estimate ARV given that I don't have any exact comps. So I pulled all sales of 4bed / 2 bath homes in that zip code for the last 2 years and found that the PPSF reduction from a one story home to a two story home around 20%. I did this for each year (median, and mean) and then I also did it for the entire data set using upper quartiles, and lower quartiles too. It was consistently a reduction of 20% +/- 3%

I am curious if this has been true for anyone else in their markets and if not what is it for you?

So when you buy a home you have to have homeowners insurance normally.  If its in a flood zone you also have to have flood insurance. 

When flipping or in any business you want general liability, but are there any other insurances or specific types of insurance that is recommended when flipping homes?

And last, sorry for all the extra edits but I didn’t see holding costs. A project like this is probably 9 months assuming you or your GC can actually line up all the trades properly  

even without using hard money and including interest holding costs monthly can easily be 600 yo 800 bucks, over 9 months that’s around 3200 to 4800  

See this article on typical holding costs and how to calculate them https://www.flipperforce.com/h...

Also cost you are excluding that can shut you down. Permits. Get them.  

They are not free but give you an extra layer of quality control and accountability.  Your city can also force a work stop order if you don’t have them and make you remove stuff to get it inspected. 

On the note of topics and code, depending on when the house was built if you replace the dry wall you lose grandfather status and will be required to update both the plumbing and electrical to modern standards. Make sure you account for this. 

You can use google earth or google maps to get a sattalite view of the roof. Their is a distance guide but in google earth their is a measuring tool. You can use this and the simple formula j Scott has in his book to get estimate of roof including the pitch.