How do we quickly and accurately analyze ARR?

4 Replies

Hi friends,

If you've seen Brandon's webinars, you'd have noticed him doing BRRRR or flip analysis in real time. As part of this analysis, he also comes up with an ARR number for that property in seconds. In reality, how do we really arrive at an ARR number without running some comps? Also, to do comps do we have to rely on a real estate agent in that market, or is there any online tools?

Any help is appreciated.

You can either come up with your ARV quickly or accurately, but generally not both unless you have a lot of experience in a particular neighborhood. You can certainly pull comps (by this I assume you mean recent sales in the area) from online tools such as Zillow, but in order to do the analysis necessary to arrive at an ARV you will need local market insight (this could come from a Realtor, but also from another real estate professional).

This is an incredibly important step when analyzing a deal, and not one to take a shortcut on.  Good luck!

If you analyze Markets instead of properties, you can do it pretty fast...and very accurate. The property's ARV is based on the Market's ARV, so by default, when you analyze markets (ahead of time), you've analyzed all the properties in that market at the same time.

I think the best way to quickly calculate ARV is to have a 'pulse' on your market.

I have setup daily email notifications using Redfin of different neighborhoods and areas in my market where I invest and am looking for deals.  

Whenever a new MLS listing is posted, a price change, or a property sold, I automatically get an email notification.

This helps me have a pulse on everything that is going on in my market, so I can much more intuitively predict the ARV in certain neighborhoods.