New to Real Estate · Houston · Member since 2026 · 80 posts · 64 votes
I am not talking about the final contractor bid. I mean the stage before you pay for a walkthrough, when photos are incomplete, access is limited, and you are just deciding whether the deal is worth chasing. Are you relying on your own spreadsheet, per-square-foot rules, contractor relationships, DealCheck / RepairPricer / PropStream, or no software at all? Where does it still break down most for you right now: local pricing, hidden scope, ARV confidence, dispo confidence, or something else?
Biggest thing that changed my accuracy: stop estimating rehab costs first. Estimate what you CAN'T build first.
Before I even think about $/sqft for rehab, I check zoning, setbacks, height limits, and overlay restrictions on the property. I've seen people budget $80K for an addition that was never legal to build in the first place. That's not a rehab miss — that's a due diligence miss.
For the actual rehab numbers at the pre-walkthrough stage, I use a tiered approach:
1. Cosmetic (paint, flooring, fixtures): $15-25/sqft depending on market
2. Medium (kitchen, bath, some structural): $35-55/sqft
3. Full gut: $75-120/sqft
Then I add a 15% contingency and compare against 3 recent sold comps that had similar scope. If my number is within 10% of what those rehabs actually cost, I move forward to the walkthrough.
The hidden scope problem Ali mentioned is real. That's why I front-load the zoning and buildability check — it eliminates the deals where hidden scope would've killed you anyway.