I've been working with my realtor to find a property in the Denver Colorado area. The next hurdle I have before I'm ready to buy is to figure out a system for determining after repair value. My realtor has access to a program called realtor property resource that has tools that can help determine after repair value for things like adding a bedroom and bathroom Etc. I am wondering if there is anyone I'm Bigger Pockets that uses this tool in their screening process. And if you have any tips or tricks. Thank you
You should not base investment decisions on RPR, z, etc. Your Realtor will get paid, so have him/her do the job they are hired to do and pull real comps. It takes maybe 15 minutes.
I pull the number from RPR and also from Realist, then I run a set of comps and make my adjustments off the MLS. With 3 sources of data I find I can get a good idea of what market value today is going to be. I have found that with RPR you should also be picking the comps it uses as well. I have had several times where it used a Colonial when I was comping a Ranch, so always make sure to check what it grabbed.. The program will allow you to remove or add things it uses for comps.
Call an appraiser. LOL.
Yes I am an appraiser which is why I chuckle with my advice.
Figuring ARV is not rocket science, but it does require access to meaningful sources of data for the best results.
Appraisers have access and are the best choice.
Realtors have access and are the second best choice.
Being your own appraiser trumps all choices.
Being a good appraiser includes compiling as many sources of data as possible, this could be doing your own research, then supplementing it with an appraiser and a realtor. Until you figure out how to be your own appraiser, I would advise calling someone who already is. Many an appraiser would be happy to teach you how to do it too.
And FYI, not all appraisals cost hundreds or take days/weeks. Ask for a verbal, desktop, range opinion & price opinion. Assert you are seeking knowledge, not a signed document to take to court. An ARV, verbal, desktop appraisal will probably cost $100-$150 and take less than a day. A verbal desktop appraisal that does not include an ARV would probably be $50-$100 and might be able to be done in a couple of hours if you get lucky with the timing of your request. Get cozy with an appraiser and see how well they treat you. Might even be able to set up a retainer agreement.
To figure the ARV, find closed sales of homes similar to what you expect your home to be when it is done. What other people have paid is likely to be what you will sell for. If your market is hot, you can lean towards the higher end, if not lean towards the lower. It really is that simple. Access to data is the tough part. NEVER let a computer be your appraiser. Become your own appraiser.
Doing your own research costs you time and maybe data subscription money.
Asking a realtor costs a little time, no money, possibly with strings attached and possibly with bias towards the results.
Hiring an appraiser costs a little time, a little money, no strings attached, no bias towards the results.
The best option is all of the above.
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