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Comping question/ dilemma
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
Expand the area from .25 mile to .5 mile or move the solds out from 6 months to a year.....but we know the last year was a lil different as far as price/value
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
You can save money with lower end finishes. If you have recently sold homes that are habitable I would use those. Also, I would look into other areas due to the lack of investment, unless you know of some development plans coming.
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Real Estate Agent Ohio (#SAL.2021003852 )
- 614-412-4610
- https://www.facebook.com/TonyAmosRealEstate
- [email protected]
Quote from @Anthony L Amos Jr:@Anthony L Amos Jr., thanks for that input, it'll help for future references, I'm moreso speaking in a comping scenario?
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
You can save money with lower end finishes. If you have recently sold homes that are habitable I would use those. Also, I would look into other areas due to the lack of investment, unless you know of some development plans coming.
Quote from @Michael L.:
Quote from @Anthony L Amos Jr:@Anthony L Amos Jr., thanks for that input, it'll help for future references, I'm moreso speaking in a comping scenario?
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
You can save money with lower end finishes. If you have recently sold homes that are habitable I would use those. Also, I would look into other areas due to the lack of investment, unless you know of some development plans coming.
Yes, If you see recently sold homes that are habitable I would use those. I didn't mean if you sold them, sorry. However, I would also expand my search like Kerry mentioned. I would also be wary of rehabbing a home where there are not many comps available. Hope this helps
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Real Estate Agent Ohio (#SAL.2021003852 )
- 614-412-4610
- https://www.facebook.com/TonyAmosRealEstate
- [email protected]
Quote from @Anthony L Amos Jr:Absofreakinlotely💣 , much obliged!
Quote from @Michael L.:
Quote from @Anthony L Amos Jr:@Anthony L Amos Jr., thanks for that input, it'll help for future references, I'm moreso speaking in a comping scenario?
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
You can save money with lower end finishes. If you have recently sold homes that are habitable I would use those. Also, I would look into other areas due to the lack of investment, unless you know of some development plans coming.
Yes, If you see recently sold homes that are habitable I would use those. I didn't mean if you sold them, sorry. However, I would also expand my search like Kerry mentioned. I would also be wary of rehabbing a home where there are not many comps available. Hope this helps
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
I agree with @Anthony L Amos Jr - be wary of being the high end home where others are not updated. But with that said, just be conservative in the ARV. Expand to show a larger radius for comps but understand some neighborhoods have more appeal than others.
Quote from @Dan White:@Dan White, awesome feedback and I'm totally in understanding of.
Quote from @Michael L.:
What can be done when you're looking for the ARV but there is no fully rehabbed houses in the area?
@Dan White
I agree with @Anthony L Amos Jr - be wary of being the high end home where others are not updated. But with that said, just be conservative in the ARV. Expand to show a larger radius for comps but understand some neighborhoods have more appeal than others.
Is this for a property you already own, or a property you're looking to buy to fix and flip?
As has been mentioned above, I would suggest looking in other areas instead of this one if it will be the only updated home in the area after you rehab it. If you are planning on purchasing an area and owning the only rehabbed/updated property in the area, you are putting yourself in a disadvantageous position out of the gate. We would much rather see you find a distressed house in an awesome area and start out ahead of the curve at purchase!!
If you absolutely need to dial-in the numbers and find a reasonable ARV on this one, be extremely conservative with your valuations as the impact that each improvement you make will be decreased simply due to the rule of averages across the properties in the immediate vicinity. If you are searching hyper locally for comparable properties, increase your search parameters to include adjacent neighborhoods starting first with the most similar neighborhoods before expanding in all directions.
If there are similarly finished homes in adjacent neighborhoods, consider a reduced value added $ amount per square foot for the same finishes due to the neighborhood the Subject Property is in not having those finishes.
Using made up numbers for sake of example, if vinyl plank flooring and granite countertops add $X/psf to the property value in Neighborhood A, but Subject Neighborhood has none of those things, consider using $(X-.2)/psf for the same updates to land in a conservative range for the Subject Property.
Best of luck and I hope this one works out well!!
Quote from @Marty Boardman:@Marty Boardman, fux and flip.
Is this for a property you already own, or a property you're looking to buy to fix and flip?
Quote from @Matt Moreland:@Matt Moreland, that was a spactacular super deep dive real quick👏🏻. The Subject neighborhood is an very decent location, and the comps I found were done to fit moreso renters and not buyers. So there are comps, just not fully rehabbed comps. Is it possible that this neighborhood doesn't warrant full rehab grade to sell a property? Should I dive in more on the latest sold comps an see if there's a trend?
As has been mentioned above, I would suggest looking in other areas instead of this one if it will be the only updated home in the area after you rehab it. If you are planning on purchasing an area and owning the only rehabbed/updated property in the area, you are putting yourself in a disadvantageous position out of the gate. We would much rather see you find a distressed house in an awesome area and start out ahead of the curve at purchase!!
If you absolutely need to dial-in the numbers and find a reasonable ARV on this one, be extremely conservative with your valuations as the impact that each improvement you make will be decreased simply due to the rule of averages across the properties in the immediate vicinity. If you are searching hyper locally for comparable properties, increase your search parameters to include adjacent neighborhoods starting first with the most similar neighborhoods before expanding in all directions.
If there are similarly finished homes in adjacent neighborhoods, consider a reduced value added $ amount per square foot for the same finishes due to the neighborhood the Subject Property is in not having those finishes.
Using made up numbers for sake of example, if vinyl plank flooring and granite countertops add $X/psf to the property value in Neighborhood A, but Subject Neighborhood has none of those things, consider using $(X-.2)/psf for the same updates to land in a conservative range for the Subject Property.
Best of luck and I hope this one works out well!!
Quote from @Michael L.:
Quote from @Matt Moreland:@Matt Moreland, that was a spactacular super deep dive real quick👏🏻. The Subject neighborhood is an very decent location, and the comps I found were done to fit moreso renters and not buyers. So there are comps, just not fully rehabbed comps. Is it possible that this neighborhood doesn't warrant full rehab grade to sell a property? Should I dive in more on the latest sold comps an see if there's a trend?
As has been mentioned above, I would suggest looking in other areas instead of this one if it will be the only updated home in the area after you rehab it. If you are planning on purchasing an area and owning the only rehabbed/updated property in the area, you are putting yourself in a disadvantageous position out of the gate. We would much rather see you find a distressed house in an awesome area and start out ahead of the curve at purchase!!
If you absolutely need to dial-in the numbers and find a reasonable ARV on this one, be extremely conservative with your valuations as the impact that each improvement you make will be decreased simply due to the rule of averages across the properties in the immediate vicinity. If you are searching hyper locally for comparable properties, increase your search parameters to include adjacent neighborhoods starting first with the most similar neighborhoods before expanding in all directions.
If there are similarly finished homes in adjacent neighborhoods, consider a reduced value added $ amount per square foot for the same finishes due to the neighborhood the Subject Property is in not having those finishes.
Using made up numbers for sake of example, if vinyl plank flooring and granite countertops add $X/psf to the property value in Neighborhood A, but Subject Neighborhood has none of those things, consider using $(X-.2)/psf for the same updates to land in a conservative range for the Subject Property.
Best of luck and I hope this one works out well!!
That is definitely something to look into more closely -- what level of rehab can the market in that neighborhood support? If it only makes sense to put in some light cosmetic touches, that may make more sense than doing a down-to-the-studs remodel if that would put you in a bad spot.
I would certainly check out the recently sold comps, that will also give you an idea of potential ARV of your own. Good luck, Michael!!
Quote from @Matt Moreland:Pep talk and gems both received and appreciated🧠✅️!
Quote from @Michael L.:
Quote from @Matt Moreland:@Matt Moreland, that was a spactacular super deep dive real quick👏🏻. The Subject neighborhood is an very decent location, and the comps I found were done to fit moreso renters and not buyers. So there are comps, just not fully rehabbed comps. Is it possible that this neighborhood doesn't warrant full rehab grade to sell a property? Should I dive in more on the latest sold comps an see if there's a trend?
As has been mentioned above, I would suggest looking in other areas instead of this one if it will be the only updated home in the area after you rehab it. If you are planning on purchasing an area and owning the only rehabbed/updated property in the area, you are putting yourself in a disadvantageous position out of the gate. We would much rather see you find a distressed house in an awesome area and start out ahead of the curve at purchase!!
If you absolutely need to dial-in the numbers and find a reasonable ARV on this one, be extremely conservative with your valuations as the impact that each improvement you make will be decreased simply due to the rule of averages across the properties in the immediate vicinity. If you are searching hyper locally for comparable properties, increase your search parameters to include adjacent neighborhoods starting first with the most similar neighborhoods before expanding in all directions.
If there are similarly finished homes in adjacent neighborhoods, consider a reduced value added $ amount per square foot for the same finishes due to the neighborhood the Subject Property is in not having those finishes.
Using made up numbers for sake of example, if vinyl plank flooring and granite countertops add $X/psf to the property value in Neighborhood A, but Subject Neighborhood has none of those things, consider using $(X-.2)/psf for the same updates to land in a conservative range for the Subject Property.
Best of luck and I hope this one works out well!!
That is definitely something to look into more closely -- what level of rehab can the market in that neighborhood support? If it only makes sense to put in some light cosmetic touches, that may make more sense than doing a down-to-the-studs remodel if that would put you in a bad spot.
I would certainly check out the recently sold comps, that will also give you an idea of potential ARV of your own. Good luck, Michael!!