BRRRR method using comps

[Elliott Holdosh]

Hello BP!

I am currently in the process of learning the beginning steps of the BRRRR method. I understand that you should find comps for the property, but I am confused on how to find comps and what exactly to do with them once you find them. Can someone please walk me through analyzing a property using comps?

[Brad Hammond]

Hey @Elliott Holdosh, I'd be happy to walk you through how to run comps.  Basically, your goal is to find as many recent sales (3 months) as close to the subject property as possible (.5 miles).  I'm assuming this is in an urban area but if not, expand these as needed.

You want to find 7-10 properties that closely reflect what your property will look like once the repairs are done.  Take a look at Zillow (or whatever your preferred platform is) at recent solds, pending sales, and currently for sale.  Most of your properties should be solds with 1 or 2 pendings and/or currently for sales.  Make sure you have the bedroom/bathroom count the same and square footage within a couple hundred.  The further you get outside of the subject home's criteria the harder it is.  Also, make sure the condition is close to what you will be doing.  

Just know that comping is mostly an art with a little bit of science mixed in.  It is going to be your opinion based on facts.