AI In Flipping

[Jake Baker]

Hi BP,

I am curious about how people are using AI in real estate investing, specifically for underwriting value-add deals such as flips and BRRRRs. My current process consists of using Dealcheck to underwrite and QBO to create a budget and track actuals. RealAI is really fun to play with and generate an analysis, but I find myself just going back to my standard underwriting practices. I am curious if anyone has significantly improved their underwriting through the use of AI in their underwriting procedures?

[Bo Smith]

This is the right question to ask. AI is good at helping you organize and speed up work you're already doing, but it's not replacing the actual underwriting logic you've built.

Where I've found AI useful: taking a scope of work and breaking it down by line item and cost, then comparing it against my historical actuals. If I'm guessing that electric is K but my last three projects had -8K, AI can flag that for me. It's a sanity check tool, not a replacement for experience.

Where it fails: I gave one of the real estate AI tools a deal, it gave me an analysis that looked great, but it missed that the property was in a flood zone because that wasn't in the MLS description. AI can't do what your GC, appraiser, and market knowledge do. Your standard underwriting process exists because you've learned what actually matters through deals that went wrong.

The real shift I'm seeing is using AI for spreadsheet building and financial modeling faster, then plugging in your real numbers and assumptions. That's legit time savings. But the decision on whether to buy? That's still you, using your experience and market knowledge.

Are you finding that Dealcheck is missing anything for your underwriting, or is the AI tool just trying to do the same thing in a different way?