Estimating repair costs?

Question

How does one go about estimating repair costs?  I'm completely new to this and this seems like one of the biggest hurdles for me.  Any advice appreciated.

Thanks.

John Cashin · Answer

I think the best way to figure out prices is just to contact contractors in the area for quotes on different projects - like getting the roof redone or the driveway done.  then when you are ready to have them do the work you already know who charges what.

Or if you just need to estimate materials because you are going to do the work yourself just make it a habit to look through circulars in the paper and stroll through your local hardware store (lowes, home depot, etc.) every once in a while.  from there, multiplying materials X square footage you can get an estimate on any material costs on the property.

John Cashin · Answer

Often you can get a ballpark number from a contractor giving him basic details of what you want done including things like how much square footage you are talking about, quality of materials, and any other important details for a particular project.  since you're estimating costs, ball park numbers are usually fine and this is what i would suggest doing to estimate repairs.

if you're trying to do a detailed project analysis, you'll probably want the contractors to come see the property but you probably won't make any friends if you don't infact own the property yet because theres a good chance you are wasting their time considering how easy it is to lose a property to someone else before its in contract.  i leave this as a later step since such details are unnecessary until you're ready to do the work.

as you do more and more properties i'm sure you'll be able to estimate repairs without this step.

John Cashin · Answer

Personally, i don't know how picky they are.  Its possible that a "detailed" project analysis made from ball park figures would be enough in a business plan, but i guess that depends on how well you can write out your business plan and what they think matters.

What i do know is there are other ways to get mortgages through conventional means.  You could partner up with someone who has assets but bad credit (trust me, they're out there  :wink:)... if you're tight on funds it may be a good idea to partner with someone for a house or two.  you don't have to continue working with them, or if you decide things are going well, you can.  there are options out there so take your time and think hard about it.

Lee Pedrazas · Answer

Thanks Rise.

How picky are HML?  Will they want a detailed project analysis or will pall park figures work if the profit margin is big enough?  I ask because even thought I have perfect credit, I have no savings or income (I'm a fulltime student) so I won't be able to qualify for a rehab loan through convential avenues.

Lee Pedrazas · Answer

Thanks.  Are contractor's generally willing to come out to a property and write up bids for a property that I don't yet own or would I be wasting my time trying to find someone to do that?