Properly assessing rehab costs

[Keith Gilde]

Hey everyone, My name is Keith, and two partners and I are at the beginning stages of opening an REI company. I have an extensive background in home repairs and construction in general but lack experience when it comes to estimating larger scale jobs. My question for anyone who has experience estimating is, how accurate and reliable is estimating by sqftage, and what other forms of estimation would you reccomend? I'm new to the REI business, and BP forums and would really appreciate any feedback. Thanks!

[JD Martin]

I personally would never estimate any rehab project just by SF. There are way too many variables inside a house that need to have eyes on the ground. Out of curiosity, why would you want to just estimate that way without seeing the property? 

Before I go look at a new prospective property, I already have a "rough" estimate of rehabs assuming it needs the majority of what the properties I buy needs - floors, kitchen/baths, HVAC, electrical upgrades, etc. So before I even go look, if the price I think we could settle at before I even see it + the "in my head" rehab number doesn't make sense, I might skip it altogether or just give it a cursory glance. Other than that, I'm doing numbers in my head as I'm walking the property.