Hello and Welcome.

We joined this community in hopes to get some real estate questions answered as well as answer questions that we can assist with. Our first inquiries follow:

In terms of Estimated costs on a subject property, ...

Q1. How do you calculate this without actually having a contract on the property that allows you to set up a contract to visit the property for an estimate?


All valid responses will be taken and digested at our next focus group meeting next week.


Thank you in advance,

From the Members of Active Resources

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"Being a millionaire starts with a millionaire mindset."

"DST = Do Something Today!"

"Before success comes in any man's life, he's sure to meet with much temporary defeat and, perhaps some failures. When defeat overtakes a man, the easiest and the most logical thing to do is to quit. That's exactly what the majority of men do."

"Edison failed 10, 000 times before he made the electric light. Do not be discouraged if you fail a few times."

"Fears are nothing more than a state of mind."

Are you for an actual calculator to calculate investment property? There are lots of options for this on the web, just google investment mortgage calculator. Sorry if I miss understood your question, but this has helped me in the past.

I rehab and either flip or rent out properties. I presume that you're concerned about rehab costs. If that's the case there are a couple of approaches, but you'll get reasonable at quesstimating your costs over time.
Regarding your first question you should be able to get access to any property you are planning on buying. If it's an REO call the Realtor. You should be in & out in an hour. Always remember there will be something you'll miss and it'll usually cost you more than you think it will to repair it.
A few points in no perticular order -
1. Always buy the property right or don't buy it. There will be others available next week if not tomorrow. I can't stress this enough. Buy it right. Seek out the right opportunities.
2. Make sure it has enough living space (typical in the neighborhood). Make sure it has the features or add them that people want. i.e. extra baths, DR instead of eat in kitchen if not both. Finish the basement if applicable.
3. Fix up the kitchens and baths. Make them nice but don't go nuts.
4. Add value to the property and try to avoid things that are costly to repair and provide little return on investment like fixing leaky basements. Do things like finishing the second floor of a cape cod or bungalow. Keep in mind you'll need to add electrics and hvac up there too.
5. Paint interior neutral colors. Add some landscaping, flowers out front. Sometimes linolieum flooring is OK, it doesn't always have to be slate or ceramic. Use Formica vs solid or granite. It looks "good enough" when flipping.
5. Consider staging the house. It can sell it faster. Price it to sell in a reasonable timeframe. This coincides with buying it right. I'll take a quick nickle over the slow dime and move on.
6. Do some repairs yourself if you can when you're starting out, and get a good handyman or contractor you can trust who won't overcharge you. Call around if you don't have these contacts. Feel the people out. Check their references if in doubt. What kind of truck are they driving? Join some local investor groups.
Do some of the demolition yourself if you don't have the other skills. Get comparison guotes but don't spend forever doing it. You'll soon start figuring out what it'll cost you. When I buy smaller ranchs and bungalows around here in Ohio I look at the repairs in blocks of $5k more or less. I can dress up a house real nice with only $10k often times.
7. Have your money ready. Be ready to buy when the chance arrives. Don't act like a big shot, nobody will be impressed anyhow.
8. I always try to complete my repairs in 30 days if possible. Take into account POS delays in some communities.

You'll have competition so try to beat them to the punch. Use a Realtor to find properties, not some schmuck "bird dog" or other desperate source.
For example I showed an REO to an investor friend of mine about ten days ago. It was a HUD for $27k list price. Needed maybe $7-10k interior updating, had a newer huge garage worth $10k itself. Anyhow he yacked about offering $21k which sounded somewhat reasonable but someone else paid $26.5k the next day. After repair value probably around $70 -80k maybe more. Could rent it out for 7-800 month.

Hope this helps.

In Commercial Real Estate, the easiest way to get the numbers you want is to list it as a NNN lease rate.

This makes it so all utilities, janitorial, taxes, insurance and CAM fees are paid by the tenant(s).

Just remember that if you are the listing agent or bringing a tenant, you don't get paid as much on NNN leases as Modified Gross or Full Service because you aren't getting a commission percentage on all of the expenses.

On new properties that aren't NNN leases, CAMs are usually provided by the property manager but would include all common area maintenance fees. Utilities on a $/sf/month basis for office are around $.12-$.20/sf/month in Reno, Nevada. Janitorial will run between $.10/sf/month to $.15/sf/month here. Taxes are available on the assessor's page and you can contact an insurance company to get quotes on insurance expenses.

ARE, I'm assuming that you mean calculating costs of rehabbing properties, and this is something that you get much better as time goes by. From experience, you will learn to account for issues that are not easily known just by looking.