How To Comp Properties For Wholesaling Real Estate

How To Comp Properties For Wholesaling Real Estate

So this training is all about comping properties, understanding how to analyze properties and comp properties. So that you actually can look at multiple properties every single day and spend most of your time comping properties so that you can make the right offer.

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So here’s what I’m going to do. I’m not going to use my properties as examples, I want to use yours. So everyone on here right now, if you have properties that you want me to comp for you, let’s do it. Let me know the address, put it right in the comment thread, and I will start comping that property for you. I’ll give you a breakdown on what I believe ARV to be what I believe as is value to be and where your budget likely would come into play. And then you know where you should probably put in an offer. So that is that’s what we’re going to do today. So if you have any in all properties that you want me to comp put them in the comments below. I’ll give you guys a couple seconds to look through your list of properties that you’re analyzing and comping. Matt Smith is already on the ball. I love that dude. Matt says dang 10 deals a month is a lot how much profit per deal. we’re averaging. It depends on market. But you know, overall, our our business is averaging roughly nine grand per deal. And we’re getting closer to about 20 deals a month. So that’s our business model. We’re in seven different states. we’re averaging roughly $9,000 a deal. And we’re getting close to averaging 20 deals a month. David got to address that a david that is awesome. Matt, that is awesome. So let’s, let’s start with David hagley. David, what market are you in? And then we’ll go from there. But David, I’m going to rock with you. I’m going to share my screen. Just so you guys know I use prop stream for all my comping. If you have not yet downloaded prop stream or sorry, got a prop stream account, go to t s o f data.com t s o f. So you’re right there data.com and put in promo code t s o f they will give you a free account for seven days. And you can download 10,000 person list for absolutely free again TSF data.com that’s where we will be comping today. So let’s start with our boy. David hagley his address. Let’s see here. All right. 8437 East 30 Fourth Street. So I need to share my screen for you guys. All right. So what was it again? Eight 437? East 34th Street? Eight 437 East 34th
Street.
All right,
so that didn’t come up. Did I write that wrong? 8437834346226? What state is that in? I’m
David.
Indian Indianapolis or? Let’s go. Are This is awesome. 8437 East 34th Street. So prop stream for whatever reason is not coming up with this property this is fine. At the right address,
David,
very rarely, if ever, am I not able to pull up the right address. So it’s a four to seven. There we go. That makes sense. 8427. Indianapolis, right on. Alright, so in prop stream, the first thing you want to be able to do is obviously kind of just take a look. In general, you can back out a little bit. But obviously I don’t want to be crossing over any major roads, right. So definitely don’t want to cross the freeway, I don’t necessarily want to cross 38th Street don’t necessarily want to cross North Pole Street. And ideally, I stay really relatively in the same subdivision. So this is essentially one big subdivision. Right. And so ideally, I want to be able to kind of stay within this subdivision, there’s plenty of homes, and I want to be able to stay within it. So I hit details, brings up the details of the home. And in terms of value, it’s not 100% accurate every single time but it’s a good premise of where we’re at. So let’s call it between 90 and 115. So three bedroom, one bath 2000 square foot home. Okay, so there’s a bunch of different stuff you could do here. But for this training, we are comping property. So I’m going to hit comparable. And it automatically comes up with MLS, you can also do you know, off market, or you could do both, but it runs it out of a year. Now that’s a long time, right? A year ago, prices were a whole lot different. So I tend to change that as long as there’s a decent amount of sold properties, right. And so there is right you have all these sold properties here. And so because of that, I will probably shorten that date into roughly three months,
right? Then I want to go here, so I’m going to shorten the sold date to three months.
So the last three months, four months consider it there’s been four properties that have sold on the MLS all within this same subdivision, I don’t want to go over 38 you know, going across this little what looks like a park. I’m open to it, but I really want to see what one and three are first because I like that it’s all kind of within this centralized location. So one I want to see the condition. Okay, a remodel, right. Typical gray paint, probably you know, this is a full blown remodel. So out of the gates now this is 1600 square feet. So it’s not quite apples to apples in the sense of 2000 square feet versus 16 square feet. But you can see that it sold for $140,000 so you’re likely going to be right in this range. Anyways, this is I have this example is the largest home out of the four that were sold. But as you can see essentially like I don’t have pictures for this but I would guess this is also a remodel. This will probably be a whole lot more like an as his older home. Yeah as his older home needs updating and so this is 75,000 is what this sold for. And this is 100 I don’t have pictures for this but this could be some level of in between a remodel and a as is home. So we have to make a best guess but out of the gates as a moment in time immediately because number one is really kind of the best comp anyways. I would say right away I can put ARV at 140 to 150 Reason being I’m going all the way up to 150 is a the market is appreciating people will pay top dollar there’s not much active to you haven’t real solid comp, which is number two, for 144. Now, when I say there’s not much active, let’s dissect that, I’m actually the next step I’m going to go do is I’m going to go see what has been active on the MLS, if anything, and you have nothing active on the MLS. So right away, I immediately say, I could sell this home after repair value for 140 up to 150. Because there’s not a person that can find a single property on the MLS in this neighborhood. So again, I keep the distance at half a mile, I don’t necessarily want to go out any further than that. This is a perfect starter property for comping right, I’m even going to see if there’s any contingent or pending. There’s one pending at 120. There’s no pictures, there’s another pending at 150. That’s awesome. We’re seven, okay sevens over here. So I want to see 150. Pictures coming soon. Darn it, I’m guessing this is a full blown remodel is a five bed, this might be in it’s better in your square feet. So as I said, out of the gates, I think 140 to 150, I would probably even immediately try to sell this property at 150 as ARV, that’s where I would go out of the gates. So here you have it. Now you also have a great competence as is, which is 75,000. So this is a great starter property to analyze, because you can figure out like, you know, someone will buy a property for 75,000. And as his condition. Now here is the takeaway that us investors need to understand you need to get pictures, you need to walk the home to some level, because you don’t know the condition of this home. So right now I’m looking at this saying I don’t know the condition of this home. So how am I going to do this? So I’m going to go in here and I’m going to say 150
eims.
point eight equals 120. They want to do that equals 120. And then so this is the formula, right 80% of ARV. Well, and this is not the right number 150 is this times point eight is 120 minus rehab. This is where a lot of people get confused. Well, your rehab, ultimately. I want to make sure I’m showing my whole screen here real quick.
Okay, let me know if you guys can see my whole screen. Are you guys seeing the calculator? Or were you seeing the calculator? Write something in the comments below as long as you were seeing the calculator?
Yes, no. Maybe seeing the calculator, though something in the comments. Yo, yo, no. All right, I’m going to stop screen share your screen share again. share screen, whole screen. Boom. Okay, so I’m over here on the calculator. So I started with 150. ARV times 80% is my rule of thumb that is my starting because how hot the market is about 120 depending upon the condition of the home, something like this, I like to use some Baba method, this price point, I’d say a good number would be about $30 a square foot to do a full blown remodel full blown, right? This home may or may not need a full blown remodel, let’s just say it does, then I’m going to go times this 120 and it’s a 2000 square foot home times $30. I can tell you right now it’s going to be $60,000 of remodel minus $60,000. a remodel. And then I’m going to try to make 10 grand minus 10 grand that’s my wholesale fee. So my numbers $50,000. Now, let me press pause for you. This is a great number. If you are going to wholesale this over to a flipper. This property could be a good rental, in which case you may not do as extensive as a rehab. So maybe your rehab goes to 30,000, not 60,000 and you might be selling it to a rental landlord like myself, I pay pretty top dollar for rentals because it’s just ROI. So I really want you to understand a couple things. You’re not always going to be selling to a flipper. So that 80% of ARV may not always be the right number and remodeling $30 a square foot for the whole home mainly not be the case either, because you might not be doing the whole home, you may not be removing the whole kitchen and putting in a brand new kitchen. So it’s always dependent upon the deal. So I would say your offer is going to be anywhere from 50,000, in case you’re going to wholesale it to a flipper all the way over to maybe even 70,000. Right? Because they’re only gonna put 20 or $30,000 into the remodel. So I would tell you, this is a great example of a property to analyze. Why don’t we jump in to the next property that we have? Which was given by my man, Matt Smith, where to go? All right, Matt Smith, 304, West, third, McCook. 304,
West,
third
tip populates.
There we go. Boom.
So I’m going to do the same thing I kind of want to take a quick little view out, just want to see I want to stay obviously, within this area, I don’t want to cross any major roads. And then I’m going as you view a little further in, because you can see, there’s a pretty major road. Like I want to stay within all of this, right. This is an interesting area, you have a lot of condos, you have some houses. So this could get a little bit more unique. All right. So I’m going to go over to comping properties. All right. So I want to go to MLS, what has been sold within a half a mile over the last year. There’s quite literally been nothing sold in the last year and a half a mile. Interesting. Okay, so what that tells me will be, there’s nothing available. So if you can bring something to market, likely there will be something available, right? So let’s see what’s active in a half a mile? Nothing. contingent pending? Nothing, and we’re not in Texas. Are we? Okay, New England. So there’s like, what I want to do then is let’s open this up to a mile. How does that change everything? Hmm, feel like something’s up here. I’m not that familiar with New England, but I’ll tell you for nothing to be active contingent pending or sold in a mile seems very odd. Um, so I don’t know the answer to that Reza moment in time in some of this goes to, you know, Matt Smith, I’d ask yet or is not knowing them. But Nebraska. like is this like a non disclosure scenario like it seems very odd, nothing would be nothing at all would be available. Right. So Matt Smith, maybe you want to chime back in maybe we take another one. I see Barbara. Posted one that we can maybe run through to 401 Berry court 241 Berry court 2401 Berry court Waukegan, Illinois. So again, want to stay I don’t want to cross these major roads. I’m going to go look at detail. 197 156 to 197, three bedroom 1500 square feet. Love it. Let’s go on here. All right, here we go. So again, Matt Smith, not certain why absolutely nothing came up on your property but could be challenged. I don’t know why Nebraska would have that to be the case. So let’s just jump into this. You have all these solds right. So I want to make sure I’m in like, a good ballpark here. So I really like like one, two and three right in the same subdivision one, two, and three to 10 171 58. So let’s see what to 10 looks like.
nice, clean home. I wouldn’t To say that that’s a remodel, it’s just a very nice clean home. Clean home, definitely would need a full blown remodel to be updated. I mean, you know, brown tile on the walls in the bathroom, again, clean, great little rental property. So that sold for. And by the way that sold. Let’s go back and change these dates. Let’s go for the last three to four months. Here we go. Alright, so I want to see so I’m over here. So number one is over here, number two is over here. Glenn floor AV may be a pretty big road. But I’d still want to see why this sold for 200,000.
And it looks like they did a gentle remodel of sorts. Nothing crazy. But they’ve put some tile things on new flooring. No new windows. So again, terrible pictures. This is wild. They’ve tiled the ceiling, interestingly enough. So I wouldn’t even call this a beautiful remodel. And these are all that is sold in in the half mile distance. And I want to stay within the half mile distance. So now let’s see what is active. Let’s see this is a duplex by the way. So I wouldn’t even count that because ours is a single family. And there’s one active at 195. Let’s see what’s going on with this one. Again, no images. So I would I would go to say because there’s these are duplexes for 200 and there’s one active for four days at 195, I would actually try to go figure out how to see this property. But you can make an argument that, you know, 200 would be probably the right MLS NUMBER, right. And then again, if you just do the math at 200, again, depending upon the condition, you want to be able to see the property get pictures of the property and then run it off like a 200 number. And then that would be your ARV right, so you go in here.
And so I just want to start all over 280% 160 minus a rehab, right so $30 a square foot is about what I gauge on some something like this. Our properties are how big 1500 so 45,000 minus 45,000 equals 115 then if I want to make 10 grand then my offer would be 105 my offers 105 if you are going to sell this to a rehab flipper, what I want everyone to be aware of not every property is going to be an ideal rehab flip property. This also could be a great rental I don’t have any pictures to go off of I’m just taking the address and saying okay, I’m probably between 105 and 115 is probably where I’m going to budget and offer for this. Let’s figure out what the sellers actually want. So that would be that deal.
Um
David we did discuss that one. Face Facebook user. Again, no name that’s okay. Put your name in here 306 North 18th
Street team.
What city was out in
Missouri, St. Joe Missouri.
Yo
back out real quick. Remember I want to I love this all these neighborhoods, perfect little neighborhood. This is exactly where I want to see these comps. So I want to go back into comping.
So I want to see what sold on the MLS in the last four months because the market has been going crazy. Alright, so we have number one is so close I love number one so what’s number 180 1000 took 242 days i’m a i’m guessing Of course we’re not gonna have any interior pictures so I’m guessing it is as is probably needed a decent amount inside it’s a triplex you have 2435 right so again, this is going to be something that you only really want single family homes so I want residential and I want single family homes, no duplex triplex or otherwise. So out of the gates, I’m looking at these low numbers saying okay, we’re probably going to be in a lower price point, right? You got 24 and 35,000. totally original as his needs a full remodel. So that is your as his number 24,000 What is 115 get us these days.
I mean, very unique. I would tell you that I wouldn’t consider this a full blown nice remodel, although they have done the floors, but it’s a very unique home. So it could be a little bit interesting there. But what does this get us?
remodel? Right? Not even a full blown remodel, they kept the cabinets so it’s like almost a hotel they painted and carpeted. Right? They didn’t even change the lights up here. So 115 if you came in here and did a whole remodel you might be able to sell for 121 25 Why is that? Justin I don’t see any comps here. Well, because the markets appreciating there’s nothing else available for them. And let’s go into active to buy at that price point. Let’s see what actives are our 106 number 174. Let’s see what that looks like. That’s really close. And of course no pictures 106 right clean, no remodel, painted. So if you’re going to go into a full blown remodel, you know, so you’re kind of clean, you know, lipstick on a pig, some paint some carpet, you can get between 106 and 115. So call it 110 average those out, and then everything else is is really low down here. So what does 75 grand get you nice little flooring and paint. And then some new shaker cabinets. I mean, again, they didn’t put down walls, they painted everything they put probably even some paint over old cabinets and they re for Mike at the counter.
So
you know depending upon where you would try to exit I would try to go exit closer to the 115. And then you can run your math backwards again as a flip your 80% minus your remodel and then minus your wholesale fee. So what is 80% of 115 90 to
see if it just
calculates everything minus i don’t know. Point 5000 brings you down 67 if you want to make 10 grand, you’re gonna be 57 B 57. If you if you believe you can do lipstick on a pig, right though some paint on there, throw some carpet on there, clean it up, turn it around. If the remodel is higher, you need to adjust. So right now anything at the 2000 $200,000 or less price point, I would estimate for you roughly $30 a square foot for a full blown rehab. If you can get away with less than that. Then I would tell you get away with less than that. Rachel What is up? What is up? All right, let’s use this as the last one to wrap it up. 640 Spring Lake Dr. Earl Leesville.
640 Spring Lake drive up early Advil. Hmm, let’s make sure I six for their Spring Lake drive earliest Ville this could be too small of a town my girl Rachel 640 Spring Lake drive
early Bill. Not sure what to say don’t bring up any data. Maybe the address is not correct. Let me know. Jeff Rapoport is on the line. What’s up, brother?
Oh,
let’s run with mats. I love Las Vegas, orange Avenue 1103 orange Avenue 11003 orange Avenue
Las Vegas. Boom.
All right, very similar to Phoenix, just a bunch of properties right in here. So that’s where I’m going to be focusing. I’m gonna go over to comps could be on the MLS could be on the MLS listing date 713. So out of the gates. I don’t love that it’s on the MLS just letting you know doesn’t mean it’s not a deal Stein on love that it’s on the MLS active for 10 days.
Don’t want to go back three or four months solds. Here we go. Now, right. Now, I definitely don’t want to cross this line. Because more often than I can change values pretty quickly when you cross a big intersection like this 95. Right. So I want to be looking at four, eight and 11. That’s essentially the ones I want to look at for is 1400 probably for rent. That doesn’t really count 818 111 no pictures. Okay, so here poses the challenge will find I will jump across and look at one a lot of these are for rent like people are buying for 1300. I don’t. That’s interesting. Something’s interesting going on there. Let’s see what the 280 brings us at three. Nice, nice home very clean, not even fully remodeled at all. So you’re right there. Now again, my challenge here is, is this a style home that is also over here. And I don’t know that right now, because I don’t have any way to judge this. But what I’ll tell you is just based out of common sense, you have to 45 to 80 to 60 to 75 to 94 to 62. So I would tell you that at very minimum, you should be thinking to 50 6070 would be some level of a nice clean home right? What is 294 look like? Boom remodel. Perfect. 294 is your ARV. This is not an ideal practice or example only because I don’t love jumping across these roads. In fact, I don’t even see where nine is nines way over here. Right? So I don’t love that. But I have some level of understanding that you can get somewhere north of 300,000 within a half mile, like being within a half mile for this very reason will happen here. can’t pull up pictures. Now we go. again to 64 unique not remodeled. I mean, you could probably make an argument that ARV is going to be that 300 number, right again, some things are I’m just assuming based around the comps but I would immediately go to 300. And then there’s nothing really showing as is all these random 1350s and 1495. somehow they’re lit. They’re lumping in rentals. But I am interested to see what is selling.
One is pending. One is active at 314. So boom. Let’s do a little deeper dive in here. So what is this 314 is 11 on the other side of the track somewhere Of course so that’s that’s a hardball I don’t love going over here. For half Do I have to what about 16 330 sixteens in the area i like i like that 350 for 1515 is also in the area I like so you’re you’re looking at You know, mid threes for remodels, pool mid three, it that just set the new tone for this comp it’s over in this area, I’d say mid threes for a full blown remodel. And you can get all these these are rents all these small ones. So I would tell you again using the formula, let’s just say yours doesn’t have a pool. So let’s turn this into, I don’t know 315, not 350 80% how big the house let’s call it 2000 square feet. So you’re at $60,000 minus 60k. You’re at 192 and you want to make 10 grand sure at 180 to 182 would be your offer number if you can show Airbnb 315.
All right. All right. So that is all the time I have for this training. This is really important that you go back and rewatch this for those of you that are my students in my coaching program, we will have this available for you guys. You know, ASAP, because this is how you comp That’s how quick and easy it is. And then you can justify it based around your negotiations with the seller. And when you are building your buyers list having conversations with the buyers about what they’re looking to pay in those areas. Much of that is revolving around how much it costs to remodel it again. If the property is under the $200,000 price point I estimate very Bubba math $30,000 a square foot for a full blown remodel, if it just needs paint and carpet. Obviously the best suggestion is understand the cost of retail paint, understand the cost of retail carpet, and then do your very best to estimate how much that would be. Paint usually is going for about $2 a square foot carpet can go three to $7 a square foot prices have been going crazy recently. So just make your best guess there. This is the comps about training. Hopefully this finds you well. If you are interested in me coaching you then throw a comment in below and say I’m interested we can so my top advisors reach out to you talk to you about what that looks like so we can have more coaching calls. But beyond that, guys. Oh and I just dropped my podcast. We are dropping podcast every week. Now go back to a podcast, app iTunes or Spotify. And check out the science of flipping podcast. We are rolling. We’re back live heavy in the paint on the podcast. And I’ll talk to you guys on the next live

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