Knowing the after repair value or ARV of a property is one of the most pivotal steps of a successful business deal. When you use real estate comps to determine which area of homes you plan to invest in, calculating the ARV of the property is the next step. Your account with InvestorCompsOnline affords you the business tools to make wise choices. Below are the basic steps you can use to accurately and conservatively estimate after repair values:
- Use sales figures from home sales (not listing (asking) prices)
- Compare home sales figures of directly comparable properties in the same subdivision or very nearby
- Use rehab estimates from about 3 licensed general contractors – it is best to clearly itemize each project.
- Use supplies and parts cost estimates from the big box stores – Home Depot,Lowe’s and Sears
The first two steps let you know what you can expect to sell the property for after it’s been renovated.The last two steps have more to do with deciding how much you want to pay for a property you intend to rehab, by factoring out expected repair and other costs. Utilizing InvestorCompsOnline as your foundational real estate comps information tool and training source ensures knowledgeable transactions each time.