Estimating repair cost ... 4 posts by 4 users

Posted: 03/06/2008 at 01:01PM

Hey Everyone,
I am new at real estate investing and decided to start off wholesaling. I joined the local real estate investment club after reading a book I bought, and by now I feel pretty comfortable with the process. I met with a seller this morning (waiting on my offer) and I have 3 other appointments to walk through houses this weekend. My question is this:

In the book I read, the author recommended a formula for estimating the repair cost in order to arrive at the ARV. But I remember seeing somewhere during my research, a repair cost estimating tool ... I just can't find it again. Does anyone know where I can find one that's available online for free? The one I saw would allow me to refine my repair cost (be more specific) before I make my offer to the seller and I believe that can make a big difference in my negotiations. If not, please feel free to offer any practices that work for you. Please help.

Posted: 03/11/2008 at 02:05PM

Estimating repairs will come with experience. From my experience, you do not need to be exact. Every house needs at least $5k, unless it's been rehabbed completely already. So, if it needs minor work - carpet, paint, cleaning - you can estimate it to be between $5k and $10k.

If the house is beat up, in need of a full rehab, including drywall, appliances, flooring throughout, plumbing, etc, etc, it's going to cost somewhere between $20k and $40k. Also, it usually costs less to rehab a house made from wood frame, and more for concrete block houses.

Rehabbers and landlords typically know much more about repairs than we do. So give them an educated guess, and then have them go by and take a look for themselves.