All Forum Posts by: Dustin P.

With regards to the ARV and repair costs, one thing to consider is that once you dawn the mantle of "wholesaler" you will inherit all the stereotypes that come with it. You may come up with a reasonable ARV and reasonable repair value, and there will be a lot of buyers that just automatically add 30-50% to the repair cost and take 20% off the ARV because you are a wholesaler and wholesaler numbers are always wrong

What I've started doing is using the ARV and estimated repair value to figure out my offer price, but leave it off the sales email. Give the buyers your asking price and comps, and that's it. ARV is very subjective anyway and often dictated by the rehab. Are you going to do a low grade rental rehab? Just a cosmetic renovation but trying to resurface and save as much as possible? Are you going to do an addition? Add a pool? Are you using a GC or subbing the work out to the individual trades? Are you a contractor doing the work yourself? It's just really impossible to give a one size fits all rehab number and ARV

Remove those numbers from the equation and let them determine their own numbers. It'll be two less things they will argue with you about

What do they want to make? As much as they can obviously

What will they settle on making? $10k, $20k, $40k, $50k, it depends on the flipper

The guys doing 1-2 deals a year typically want to make more than the guys doing 100 deals a year

I will say, do not use ARV x 75% minus repairs as an end all, be all guideline. This will be market dependent of course but I know in Phoenix no one is buying at that margin, it's closer to 85%-90% even (For a standard remodel, not addition play)

The best thing you can do is look up recent cash sales to investors in your area, see what they paid for the house, do your best to estimate the rehab from the pictures and/or driving by the house, and then comp the house to determine the ARV. Back yourself into the % of ARV minus repairs, do that over and over and you'll get a good idea of what they will pay in that area

The only caveat to the above is that an assignment fee may not show up in the tax records. I know in Arizona the price listed on the tax records does not include any assignment fees added  by wholesalers

You definitely want to put it under contract first, get your contract and EMD to title, and then look for cash buyers. Start by pulling the tax records of all the cash buyers in a few miles radius around the house. Use a skiptrace service and start dialing. If you are running low on your inspection period, reaching out to a larger wholesaler to move the deal to you may be a good option. I would just disclose to the seller that you may assign the contract to another entity.

Biltmore is a great area, and like pretty much everywhere in Phoenix it's red hot right now. I sent a wholesale property out in that area earlier this week and had 3 buyers ready to jump within an hour. The hardest part is just finding the properties right now, people are willing to pay a lot and competition is fierce. Good luck!

The market is crazy right now but if you were to buy something with that formula you shouldn't have an issue selling it. Sometimes buyers are going up to 90% ARV minus repairs, but that's because they are banking on selling it for well over the closed comp ARV once they are finished with the remodel

A good way you can figure this out is by searching closed properties that have been purchased by investors and reverse engineer them to figure out the % of ARV

I'll throw one more recommendation on Dr Evictor / Hull Holiday and Holiday. Very professional and they move quickly!

Good, well-priced contractors are like gold and most people will be hesitant to hand out names of guys that do good work for a decent price, especially in this market

My advice would be to do some legwork yourself and go out and get some bids. Call 10-20 roofers and get roof estimates, call 10-20 tile guys and get price/square foot estimates for floor tile and shower tile, call 10-20 HVAC guys and get estimates on a 3, 4 and 5 ton unit, call 10-20 painters and get a price/square foot estimate for interior and exterior painting, etc

You could also call GCs and get them to a property to bid it out but just know that, especially in this market, a GC is going to charge a lot and that will sap a lot of your profit vice managing subs yourself. Depending on your project size though this may be necessary (Adding square footage for example)

Good luck!

Hey David I will shoot you over a request - I'm in Tempe and always down to connect with investors!

The property looks great Cecil nice work! Each deal definitely teaches you something new and most people (myself included) jump into their first project without knowing all the answers. It's great to see it turned out well though and that you were able to turn a profit on it. Onto the next one!

If you look up Kellen King on this site I'm not sure how active he is on BP anymore but he's a realtor with a lot of experience in STR in Phoenix/Scottsdale