Wholesaling ARV and Repair costs

[Candace Hall]

Hello everyone,

I've made a few Wholesale Deals while working with a very generous Mentor. But now I am curious about a few things I read in a few Facebook Group post.

The first gentleman stated that "he doesn't even bother with the ARV and repair costs because buyers are going to do inspections anyway"

Then another gentleman let me know that he never speaks to Home Owners. He said "He will do his due diligence on Zillow and other sites, send the home owner an Offer Price, if they agree he makes a deal and if he doesnt then he just moves on"

Im trying to see how realistic this is. And although I would prefer to do things in a way that will be convenient for all parties involved. I would also like to accomplish getting more deals.

Please feel free to chime in!

[Dustin P.]

With regards to the ARV and repair costs, one thing to consider is that once you dawn the mantle of "wholesaler" you will inherit all the stereotypes that come with it. You may come up with a reasonable ARV and reasonable repair value, and there will be a lot of buyers that just automatically add 30-50% to the repair cost and take 20% off the ARV because you are a wholesaler and wholesaler numbers are always wrong

What I've started doing is using the ARV and estimated repair value to figure out my offer price, but leave it off the sales email. Give the buyers your asking price and comps, and that's it. ARV is very subjective anyway and often dictated by the rehab. Are you going to do a low grade rental rehab? Just a cosmetic renovation but trying to resurface and save as much as possible? Are you going to do an addition? Add a pool? Are you using a GC or subbing the work out to the individual trades? Are you a contractor doing the work yourself? It's just really impossible to give a one size fits all rehab number and ARV

Remove those numbers from the equation and let them determine their own numbers. It'll be two less things they will argue with you about