Key Take Aways
- Four easy ways to make deal analysis fast are: excel calculator, cheat sheet, 70% ARV rule or use automation with Zapier
- There are lot of expenses beyond repairs on a flip. You need to factor buying costs, holding costs and selling costs
- Get access to our free tool by signing up for emails
Sign Up To Get Your Free Deal Analysis Tool
Hey there, savvy real estate enthusiasts! Welcome back to the J&A Home Buyer blog. Today, we’re delving deep into the intricate world of real estate deal analysis, specifically tailored for those looking to flip properties like pros. Whether you’re a seasoned realtor, a budding wholesaler, or simply curious about the process, buckle up because we’re about to embark on a journey of insights and strategies.
Understanding Repairs
Picture this: you’re eyeing a potential property for a flip, but you’re unsure how to crunch the numbers effectively. No Sweat! If you aren’t very handy and need to learn more about how repairs are made and costs that are associated with those repairs we recommend you read The Book On Estimating Rehab Costs by J Scott. J does an excellent job of explaining how to budget and plan for rehabs and what you need to look for when walking a property. We also have some budgetary numbers from Houston TX in our Free tool that we provide.
Unveiling “Hidden” Costs
Now, onto holding costs – the silent profit killers. Beyond repairs, holding costs can sneak up on you, devouring your margins if left unchecked. Think property taxes, utilities, insurance, and lawn care. If you live in Texas you know property taxes can put a dent in your wallet! It adds up, trust us. Then don’t forget to add in your purchase and resale costs! Things like Loan Points, Loan Interest Appraisal, Survey, Title Fees for the purchase and the sale, Listing Agent Commissions and HOA Fees. But fear not, we’ve got four game-changing methods to streamline your analysis process.
Three Traditional Ways to Crunch Numbers
So how do you factor in all of those costs? First up run the numbers in your area and find out what most of these costs run. Now you can create a tool to help you analyze these quickly. First up, the trusty Excel sheet – your digital companion for number crunching. Whether you’re in the comfort of your office or on-the-go, Excel has your back. Next, cheat sheets – perfect for quick evaluations during negotiations or on-site assessments with a quick glance you can get a range that may work given your deal criteria. And let’s not forget the 70% ARV Rule, a golden nugget in the investor community for fast, ballpark assessments. You take the property value after repairs (ARV) and you subtract costs and multiply by 70%. In most cases the 70% rule will have enough meat on the bones to give you a profit. We highly recommend you run numbers the long way and do your due diligence before you are out of option period however this rule should get you to the point of starting to talk about offer price.
Introducing Innovative Tools
But wait, there’s more! Introducing our innovative automated tool, a seamless fusion of Zapier and Google Forms. Picture this: your at a seller appointment and all you type in is your repairs and like magic you get an email that tells you exactly what the offer price is and what an estimate on your holding costs would be. We all know that establishing rapport with your seller is the number one way to get a deal done. Yet at the same time it is important to have a conversation on price while you are still at the appointment. If you sign up for our free tool we will send you our free tool and a step by step video to show you how to make your automated offer using Google Forms, Zapier and Gmail.
Conclusion
As fellow real estate investors based in Katy Texas, serving the vibrant Greater Houston area, we understand the importance of efficient deal analysis. Sign up for our free tool, stay updated on meetups, and access exclusive content designed to sharpen your real estate acumen.
In conclusion, deal analysis doesn’t have to be daunting. Armed with the right tools and strategies, you can navigate the real estate landscape with finesse. Connect with J&A Home Buyers – your partners in real estate success. Together, let’s turn every deal into a triumph!
Stay tuned for more insightful content, and remember, the key to real estate mastery lies in the details. Happy flipping! 🏡📈