Rehab tool accuracy question
Investor · Member since 2022 · 112 posts · 150 votes
Rehab tool accuracy question
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David RobertsonBusiness Member
Flipper/Rehabber · Kansas City, MO · Member since 2010 · 758 posts · 780 votesHere'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, 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.
The hard part is finding out what your contractors charge, after that it's just basic math that you can do in a spreadsheet.
4 Replies
- Lender · Morristown, NJ · Member since 2022 · 153 posts · 71 votes3y
- 3yDavid RobertsonBusiness MemberFlipper/Rehabber · Kansas City, MO · Member since 2010 · 758 posts · 780 votes
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, 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.
The hard part is finding out what your contractors charge, after that it's just basic math that you can do in a spreadsheet.
- 3yDavid RobertsonBusiness MemberFlipper/Rehabber · Kansas City, MO · Member since 2010 · 758 posts · 780 votes
To answer your specific question, is $63k accurate for a 212sf average grade kitchen renovation?
Here's how I would estimate a 212sf kitchen renovation in Kansas City assuming an average grade materials from a big box store like Home Depot or Lowes.
Overall my price is around $10k for materials, and $7k for direct labor/installation costs + $8k for GC's OH and profit for a total of $26k.
You could certainly save money by eliminating some scope of work, buying cheaper materials, and managing the subcontractors yourself (instead of hiring a GC) which could bring the cost down to $15k ish.
I'm sure you could also pay substantially more if you are relocating walls/relocating plumbing locations/electrical locations, buying luxury grade appliances/materials, and hiring an expensive retail GC, but I personally would expect to pay anywhere from $15k to $25k for an average grade renovation.
- Investor · Member since 2022 · 112 posts · 150 votes3y
Thank you!! This is much more in line with my numbers, I havent spoken to any contractors yet since I am still analyzing properties but your numbers seem much more in line with what I was expecting for that size. I kind of pannicked when I saw the rehab estimator numbers. Obviously I need to speak to a contractor but this definitely helps me not feel insane.
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