How to Estimate Rehab Costs with No Construction Background
Understand and Learn from Customers
If your trying to sell something the best way to do so is figure out your clientele. What do the people want and what do they like to avoid? This can mean researching the surrounding area, reaching out to people who buy what your offering and selling. You can also look online, in Library, Magazines, group chats who focus on Rehabbing and Renovating. The more homework you put in the better of a grade you will receive at the end of the day.
Understanding the Process/ Methods
It’s very important before starting your voyage as a Rehabber/Renovator to do your research. The more you know in advance the less you will be surprised down the road. You must realize that this business isn’t for everyone. Interview and talk with those already involved in the business. There are many who would be willing to share the do’s and don’ts’ s of the business. Check out different scenarios, including building plans, costs of architects and common contractors needed to execute the jobs required.
Think Like a Rehabber
A key tip to know when working in the business is how to evaluate a deal. When evaluating a deal, you’ll want to almost always work backwards. You will want to use the 70% Rule. If you are unfamiliar with this, the formula is determined by the ARV, multiplied by 70% then subtract all the Renovation costs. This is the first step in even attempting a rehab. If you cannot master the concept of locating and determining which properties are a good deal, then this may not be the right fit for you.
Find a Deal
Now that you have an idea of what your customer is looking for use that to find deals that meet the criteria and start flipping. Your top priority should be researching and understanding that you know as much detail and information about this business before jumping all in. You want to be able to put your all in and be accountable for these projects. You come to find working in this business that some are all talk. Do yourself a favor; Don’t talk about it, Be about it!!