Today's post is directed to new investors out there and focuses on your buying strategy. Before you decide to buy a property (excluding short sale purchase, which you will get under contract first) you need to estimate repairs that are needed. There are plenty of real estate investors out there who don't know how to quickly and accurately estimate repairs on properties. If you drag your feet trying to determine repairs for too long the deal can get up and walk away from you.

For a lot of seasoned investors and rehabbers out there, this one probably doesn't apply to you. But to everyone else, it's very important to know how to quickly and accurately estimate the repairs on a property. And obviously, in the beginning days this is not going to be as easy, but really, it's not as difficult as you would think. And I'm not a rehabber. I don't rehab properties. I don't do construction personally. So, if I'm able to understand and accurately and quickly estimate repairs, then you can too.

I believe the best way for you to start to really get a good understanding in the early days is hire a couple, or request a couple construction bids on some properties that you're considering buying. And definitely hire more than one. The more you can get the better. And the more you do that on different properties, you'll start to see a pattern and you'll start to understand where certain things fall into play and what they cost. And as far as the little items go, you can always go to Home Depot or Lowes and price some things out. But the majority of the repairs that you need to always keep in mind when doing rehab job properties are incorporating the labor costs. You've always got to keep this cost in mind, especially if you hire this out, which you should hire this out – remember, I don't recommend doing repairs by yourself. And the majority of your cost when you write that check after it's all done is going to consist of manual labor.

Now, what you'll come to find, and the way we estimate repairs now, we try to do it very simply, but it's going to come down to really one of a few things. It's going to cost $5,000, $10,000, $15,000, or $20,000 plus. And if you're in for a $20,000 plus rehab in your early days, then it's probably an investment that you want to avoid because $20,000 plus rehabs, you never know what could happen. If you're doing a rehab that is going to cost that much, then be careful. In fact, I would avoid it until you've got a little bit more experience under your belt. But typical rehabs fall within $5 – $15K. This usually includes kitchen replacements (cabinets, counters) and bath upgrades (fixtures, possibly tile) and the customary carpet and paint expense, sometimes a new roof. Once you get a good basic understanding of the algebra, the details of it, (especially if you know what the average costs for the typical repairs/upgrades run) then you can start to quickly say, "Okay, this is probably going to cost between $7500 and $10,000. So, somewhere between $5,000 and $10,000." And that's how we do it. There's no exact science to it, but if you want to be in this business, then you've got to act quickly. You've got to be able to make decisions quickly and accurately and you're never going to be able to estimate it to the T anyway. So, why bother. So, start to quickly understand and accurately understand how to estimate repairs on these properties so that way you can grow your business, especially if your niche is more along the lines of doing rehabs. Here's to a great weekend and plenty of showings on properties. You can learn more details about estimating your purchasing power by going to:

www.freemakemoneygift.com/invitation.html

As always, I am here to help you with your real estate investing, feel free to reach out to my staff or I at www.BrianEvansSupport.com