What does a good "deal" look like?

Question

What % of ARV is what just about every investor is willing to pay? Give an example of what you consider to be a good deal. There is one more thing. Would it be a good idea or bad idea to find out where the end buyer get their comps from? For example, I may use my own source to get comps. The other investor the house will be sold to may prefer to figure ARV using their source for finding good comps. What is the best way to even calculate ARV?

Tony Marcelle · Answer

If I am only going to wholesale the property to another investor as soon as I buy it, do I have to have the exact repair costs or a repair estimate? I thought a repair estimate is ok if I am flipping the house to another investor who will handle the repairs.

Isaac Barrow · Answer

I would use the 70 percent rule, but like Brian said, make sure it  is backed by rehab numbers and rental numbers. I would just try to find something that is supported by comps/general market activity.

Brian Pulaski · Answer

I don't have a standard percent of ARV I am wiling to pay. I crunch my numbers on each individual deal. Some people use the "70% rule" some don't. Just remember these rules need you to back out the rehab costs and your fees.

Regarding ARV I have a spreadsheet I use, and I also discuss with my realtor. If you are providing an ARV, you should be substantiating where you got your numbers.