Rehab estimation costs

[Daniel Tkach]

Hey everyone,

I am an out of state investor and im starting doing fix and flips in pittsburgh, the main obstacle for me now is estimating rehab costs from the videos, can you please advice from your knowledge how can i learn to do it

Thanks in advance.

[Matthew Paul]

Go there and talk to contractors .  You arent going to estimate anything from a video . There is more to investing out of state than the condition of the house . Its your money but I would drive the areas to get a feel for whats around what you are buying . 

[Bruce Woodruff]

@Matthew Paul is 100% right. You are going to get into big trouble trying to estimate from a video or photos. And the neighborhood is even more critical as he said.

I'd bet even a veteran Contr like Mr Paul would hesitate before giving a rehab $$ number based on a video alone.

It will take you years of actual doing before you could even get a number from a walk-through.

[Shawn Parsh]

Daniel,

I agree with the others. You said you are an out of state investor, how many properties have you bought and flipped out of state? I know there are many people on BP that invest out of state, but the challenges for doing so are not small. Those that are likely successful have a lot of prior investing experience. 

One exception that I have seen over the years has been with my fellow service men and women. As members of the military it is not uncommon to be moved every 2 to 3 years. For those that chose to buy a home at a duty station they then have to decide to sell when they are transferred or hold on to the property. Given the fact that it is possible to get stationed at the same base sometime in the future during what could be a 20,30, or even 40 year career some decide to keep the property. In addition, some people plan to retire back at a base they were stationed at sometime in their career. 

What this narrow group of investors have in common though is they know the market well because they lived there for a couple years. They likely also have contacts in the area that could help oversee, maintain, and manage the property. 

I know others will disagree, but for me I focus on investing where I live. If I'm going to invest the amount of money required I want to personally be able to keep an eye on the property, and interact directly with those assisting me. For what I know about your situation I would echo the others and say go to the property in person. 

[Michael Mannino II]

Hey Daniel,

I suggest to drive to the area to see the actual property you are buying. Go there find a good contractors and talk about the estimation.

[Jeremy Taggart]

@Daniel Tkach you need to be working with someone that does rehabs themselves to be able to tell you how much it's going to cost after walking it. Who is taking the videos for you?

You can obviously have a contractor give you an estimate but they will likely want paid for their time unless it's a place you have under contract then you can likely get them to give a bid if you are potentially going to use them for the job.

[Bruce Woodruff]

Quote from @Jeremy Taggart:

You can obviously have a contractor give you an estimate but they will likely want paid for their time unless it's a place you have under contract then you can likely get them to give a bid if you are potentially going to use them for the job.

Contractors are onto that. All investors will tell you that they have a bunch of properties coming up. And that they will use you for all of their future work. Never (or rarely) happens. So I wouldn't trust a bid from a Contractor unless you pay them, the other guys will just mail it in. IMHO.

[Jacob Sherman]

$45 per sq ft light rehab , $75 heavier rehab . $150 new construction 

[Alex Hujdus]

I would not recommend estimating rehab costs from a video. It's definitely worth paying a contractor to walk the house for you and give you a professional opinion. It may cost about $100 for the walk through and bid, and that's really not a lot in the long run. 

Professionals should be compensated for their time, and you should hire a professional to walk any property you're considering spending thousands of dollars investing in. This will protect you in the long run! 

[Matthew Paul]

Quote from @Alex Hujdus:

I would not recommend estimating rehab costs from a video. It's definitely worth paying a contractor to walk the house for you and give you a professional opinion. It may cost about $100 for the walk through and bid, and that's really not a lot in the long run. 

Professionals should be compensated for their time, and you should hire a professional to walk any property you're considering spending thousands of dollars investing in. This will protect you in the long run! 

 You are kidding about the $100 I hope .  The contractor is basically doing a home inspection and then writing up an estimate . Thats more like $500 .    Between driving there , looking the place over , sitting down compiling an estimate , you would have 3 to 5 hours tied up in that .  Not for $100 

[Alan F.]

Quote from @Daniel Tkach:

Hey everyone,

I am an out of state investor and im starting doing fix and flips in pittsburgh, the main obstacle for me now is estimating rehab costs from the videos, can you please advice from your knowledge how can i learn to do it

Thanks in advance.

 Many contractors bid from afar, just email the wet stamped prints in PDF.