Repair cost

[Donny Nguyen]

Hello group,

Let's say I find a motivated seller with equity. How do I best estimate the properties repair cost without looking at it so that I can have a good Max Allowable Offer prior to locking it up?

Thanks, Donny.

[John Chapman]

In our area, costs can really vary widely and guys with full time crews can beat my numbers any day. My general rule of thumb is that $10/ft is the minimum amount in rehab. I don't care what a motivated seller says, the place always needs work. $20/ft is a pretty decent rehab (some mechanicals, foundation, paint, flooring). $30/ft is a complete gut job. I emphasize, these are just my rough rules of thumb, and I'd insist on seeing the place first before making an offer and basing it on actual repairs. If they want an offer before you can see it, just tell them you'll assume the worst and your offer will be low as a result. In that situation, I use a $30/foot number.