All Forum Posts by: David Robertson

Clearly this forum is being spammed with fake positive reviews.

5 posts posted within minutes by first time posters.

Hopefully @Moderators mark this stuff as SPAM.

Based upon the screenshots of the software it looks like Investor's Edge software is just a white label of Propstream.  It also appears Investor's Edge may have rebranded from their old company name "Do Hard Money".

Propstream screenshot:

"Investor's Edge/Dohardmoney" screenshot:

It looks like BP went back to the old Rehab Estimator tool and got rid of the powered by Kukun version.

Honestly, the Kukun-powered version seemed gimmicky, and wasnt customizable at all.  Maybe it was good for rough numbers, but I can't imagine actually using it to create a final rehab estimate for a project.

Learning about renovation costs is a process that takes time and experience. Here is my boilerplate list of the steps you should take to learn how to estimate rehab costs:

#1 Read the Book on Estimating Rehab Costs

Expert house flipper J Scott discusses the fundamentals of budgeting and pricing rehab costs and reveals the steps, tips, and tricks he uses to accurately estimate costs for 25 common trade categories and hundreds of repairs. The Book on Estimating Rehab costs is a must-read book for new rehabbers that struggle estimating rehab costs for their rehab projects.

Keep in mind, this book is a little dated so the prices may not be accurate today, but it still should provide the basic process of estimating the different trades and scopes.

#2 Walk Through Distressed Properties and Spy on the Competition

Walk through a couple of completed rehabs that a local real estate investor has completed in your local market and study the types of repairs they made and the level of finishes they installed in the property.

Spying on the competition and understanding what buyers are looking for will help you determine what type of repairs and level of finishes you need to install in your own properties.

#3 Explore Lowes and Home Depot to Learn About Material Pricing

Take a tour through Lowes and Home Depot (or their websites) and look at finishes materials and fixtures that you will consider using in your rehab projects. This will help you get a better idea of what tile, hardwood, carpet, plumbing fixtures and light fixtures costs for your rehabs.

#4 Contact Local Contractors For Pricing

Call local Subcontractors and get budget pricing for common repairs on your typical rehab project.

For example, call a roofer and ask what their average cost per Square of Architectural Asphalt Shingle Roofing would be on a 1,500 sf house, with a 6/12 pitch.

#5 Build Out Your Database in a Spreadsheet or Estimating Software

Once you start to get a better understanding of Labor and Material costs you will want to store this data into a spreadsheet or software that you can use to help you streamline the estimating process.

#6 Practice, Practice, Practice

Walk through distressed fixer-upper properties (or find properties virtually online) and practice creating detailed scopes of work, quantifying repairs and estimating rehab costs for the projects.

This will help you get acquainted with common rehab repairs, rehab costs & estimating terminology.

#7 Get Your First Rehab Project!

You can practice all you want, but ultimately you will learn the most about estimating rehab costs by actually rehabbing a house. Getting your first rehab project will require you to create a SOW, talk to contractors, compare and review bid proposals, review budgets, & make countless trips to Home Depot.

You will inevitably make mistakes and underestimate things, but you will learn 90% of what you know by just doing your first rehab!

#8 Learn from Your Experience!

Once you complete your first house flip project, take some time to review your actual costs that you spent on the project and compare it to your initial estimates and budgets.

Reviewing your final numbers will help you gain a better understanding of how much you actually spent in each Category and identify areas where you underestimated cost and blew your budget.

When you buy your next house flip project you will have this valuable learning experience to help you build a more accurate estimate!

As your continue to do more and more houses, you'll gradually gain more experience and be able to develop accurate estimates quickly and confidently!

Hi Michael,

Learning about renovation costs is a process that takes time and experience. Here is my boilerplate list of the steps you should take to learn how to estimate rehab costs:

#1 Read the Book on Estimating Rehab Costs

Expert house flipper J Scott discusses the fundamentals of budgeting and pricing rehab costs and reveals the steps, tips, and tricks he uses to accurately estimate costs for 25 common trade categories and hundreds of repairs. The Book on Estimating Rehab costs is a must-read book for new rehabbers that struggle estimating rehab costs for their rehab projects.

Keep in mind, this book is a little dated so the prices may not be accurate today, but it still should provide the basic process of estimating the different trades and scopes.

#2 Walk Through Distressed Properties and Spy on the Competition

Walk through a couple of completed rehabs that a local real estate investor has completed in your local market and study the types of repairs they made and the level of finishes they installed in the property.

Spying on the competition and understanding what buyers are looking for will help you determine what type of repairs and level of finishes you need to install in your own properties.

#3 Explore Lowes and Home Depot to Learn About Material Pricing

Take a tour through Lowes and Home Depot (or their websites) and look at finishes materials and fixtures that you will consider using in your rehab projects. This will help you get a better idea of what tile, hardwood, carpet, plumbing fixtures and light fixtures costs for your rehabs.

#4 Contact Local Contractors For Pricing

Call local Subcontractors and get budget pricing for common repairs on your typical rehab project.

For example, call a roofer and ask what their average cost per Square of Architectural Asphalt Shingle Roofing would be on a 1,500 sf house, with a 6/12 pitch.

#5 Build Out Your Database in a Spreadsheet or Estimating Software

Once you start to get a better understanding of Labor and Material costs you will want to store this data into a spreadsheet or software that you can use to help you streamline the estimating process.

#6 Practice, Practice, Practice

Walk through distressed fixer-upper properties (or find properties virtually online) and practice creating detailed scopes of work, quantifying repairs and estimating rehab costs for the projects.

This will help you get acquainted with common rehab repairs, rehab costs & estimating terminology.

#7 Get Your First Rehab Project!

You can practice all you want, but ultimately you will learn the most about estimating rehab costs by actually rehabbing a house. Getting your first rehab project will require you to create a SOW, talk to contractors, compare and review bid proposals, review budgets, & make countless trips to Home Depot.

You will inevitably make mistakes and underestimate things, but you will learn 90% of what you know by just doing your first rehab!

#8 Learn from Your Experience!

Once you complete your first house flip project, take some time to review your actual costs that you spent on the project and compare it to your initial estimates and budgets.

Reviewing your final numbers will help you gain a better understanding of how much you actually spent in each Category and identify areas where you underestimated cost and blew your budget.

When you buy your next house flip project you will have this valuable learning experience to help you build a more accurate estimate!

As your continue to do more and more houses, you'll gradually gain more experience and be able to develop accurate estimates quickly and confidently!

I did try out the new BP "Rehab Estimator tool" and it looks like you have zero control over the cost of anything. All of the prices are provided by "Kukun" with no ability to customize the pricing or use your own prices.

The problem with estimating tools that "estimate for you" like Kukun is you have no idea how any of these prices are being calculated and most of the calculations are likely wrong for your specific project needs.

Every project is different and every investor is different, which is why every investor across the nation should have their OWN pricing sheet that they use that uses their specific materials and labor prices from their local contractors. You should not be using someone else's prices (or Kukun's algorithm), you should be using your own prices from your local contractors and using the specific material selections you picked for your project.

Here's an example of how bad some of the data is in Kukun and why it's not practical for investors that are wanting to create accurate estimates for their projects:

I added "Exterior Doors" to my project, and I was told that 4 single doors and 1 double door is $59,352 in Kansas City, MO which is 20x what I would actually pay as an investor.

I believe the above was a bug, but nonetheless there was no way for me to fix this issue or understand why or how it was calculating this value.

In summary, you don't need a fancy algorithm to tell you what something costs, you just need to know basic math and have a general understanding of how much materials cost and what contractors charge for specific repairs.

For example, if I have 5 exterior doors I need replaced (4 single entry doors, 1 french patio) this is how I would estimate the costs:

- Single exterior door labor 4 x $250/each = $1,000

- Single door material 4 x $300/each = $1,200

- French patio door labor 1 x $400/each = $400

- French patio door material 1 x $750/each = $750

Total = $3,350

Add 25% profit for your contractor and the quote should be around $5k for 5 doors.

Finding material costs is as simple as exploring Home Depot's or Lowes' websites and researching material costs.  The hard part is finding out what your contractors charge, after that it's just basic math that you can do in a spreadsheet.

I have a few downloads in my file place here on BP which might come in handy.  

https://www.biggerpockets.com/... 

https://www.biggerpockets.com/...

If you are going to build your own spreadsheet, I would setup your spreadsheet with a Category column, Vendor Column and accounts column.

Categories - this will allow you to track all of your expenses to a specific category so you know "what" you spent money on and compare it to your initial budget.

Vendors - this will allow you to track your expenses by each vendor so you know "who" you paid (contractors, home depot, etc).  You'll need to know how much you paid to each vendor for 1099s

Accounts - this will allow you to track how much you paid out of specific bank accounts, credit card accounts for reconciling expenses.

Here's the problem with estimating tools that "estimate for you"....if you are using the new BP Rehab Estimator tool you have no idea how any of these prices are being calculated and most of the calculations are wrong.

I tried out the new BP "Rehab Estimator Tool" and it looks like you have zero control over the cost of anything. All of the prices are provided by "Kukun" with no ability to customize the pricing or use your own prices.

Every investor across the nation should have their own pricing sheet that they use that uses their specific materials and labor prices from their local contractors. You should not be using someone else's prices (or Kukun's algorithm), you should be using your own prices from your local contractors and using the specific material selections you picked for your project.

Here's an example of how bad some of the data is in Kukun and why it's not practical for investors that are wanting to create accurate estimates for their projects:

I just added "Exterior Doors" to my project, and I was told that 4 single doors and 1 double door is $59,352 in Kansas City, MO which is 20x what I would actually pay as an investor.

I believe the above was a bug, but nonetheless there was no way for me to fix this issue or understand why or how it was calculating this value.

In summary, you don't need a fancy algorithm to tell you what something costs, you just need to know basic math and have a general understanding of how much materials cost and what contractors charge for specific repairs.

For example, if I have 5 exterior doors I need replaced (4 single entry doors, 1 french patio door) this is how I would estimate the costs:

- Single exterior doors labor 4 x $250/each = $1,000

- Single door material 4 x $300/each = $1,200

- French patio door labor 1 x $400/each = $400

- French patio door material 1 x $750/each = $750

Total = $3,350

Add 25% profit for your contractor and the quote should be around $5k for 5 doors.

The hard part is finding out what your contractors charge, after that it's just basic math that you can do in a spreadsheet.

I'm going to break my response down into 2 recommendations, because there are 2 phases of estimating costs that require different "apps".

- Quick Estimates/Rough Calculations 

- Detailed Estimates

Quick Estimates/Rough Calculations using the Human Brain/Calculator/Notepad

When you are first evaluating a deal you need to be able to roughly estimate costs as quickly as possible to determine if the property is a good deal and if you should make an offer.

As other's have suggested, the human brain is great at quickly making rough calculations.  Experienced investors can walkthrough a property and quickly tabulate rough costs of the major renovations in their head.

Example:

Roof $5k, kitchen $15k, bathroom $5k x 2, flooring x $3/sf, etc, etc.  

This rough math can all be done using the human brain, a calculator or notepad to help you quickly evaluate a deal without fumbling around with a spreadsheet or an "app".

Detailed Estimates using Spreadsheets/Software

The problem with the human brain (mine at least), is my brain tends to forget things, so after I walkthrough a property I like to go through a checklist to make sure I didn't forget anything.

I also like to put my estimate information in spreadsheet/software to document all of the repairs for future reference.  

Eventually, once I get the property under contract I will need to give this detailed estimate and SOW information to my business partners, lenders, Contractors, etc.  

I will also use my detailed estimate as a reference for managing my budget during construction.  

A good spreadsheet or software can help streamline this process so you aren't losing all of this data in your brain/calculator/notepad.

Spreadsheets

To start, you should really create your own custom spreadsheet with all of your typical repair items and prices that you can use as a checklist.  

Your spreadsheet should have a list of all of your labor prices that you pay your contractors in your local market, and it should also include material prices for your specific materials you use in your projects.

Estimating Software/App

There are estimating apps/software that streamline the estimating process that have additional benefits like:

- Ability to save your own custom estimate templates with your own pricing, SKUs, etc

- Ability to make material selections and include exact material SKUs in your estimates

- Ability to create shopping lists for your project materials

- Ability to create estimate reports/SOW detailing your estimated costs in a professional report

- Ability to create SOW documents for your Contractors telling them exactly what they need to include

- Ability to track and compare your actual costs against your estimates

These are all things the human brain can't do, which is why I tend to do the detailed estimates in a spreadsheet/software.