"The Rules" of Investment Property

[Lisa T.]

Clarity please! When calculating a potential deal, is the "Rule of Thumb" 70% or 75% (i.e. ARV x 70% - Rehab = Max Offer)? Also, any recommendations for estimating rehab cost (i.e. ARV x 10% + $10k = Rehab Budget)? I'm seeing various % for both and would like to ensure the math is correct. Thank you!

[David Cruice]

@Lisa T. , that's like asking, "How long is a piece of string"?.  The factors are relative; not absolute.  It's whatever you, as an investor, are comfortable with.  As you newbie, you'd be best to err on the side of caution and go with the more conservative numbers, i.e. lower percentages to give yourself some leeway should something go wrong.  Watch @Brandon Turner podcast on his BRRRR method. That will give you some very good insights. Also read this article: https://www.biggerpockets.com/renewsblog/brrrr-buyrehabrentrefinancerepeatprimer/ Best of luck to you.