How to comp a property real life examples

Yeah. Hey guys, how’s it going? So right now I’m gonna go over a quick example real life example of you know how to comp properties and kind of walk you guys through it. This is a deal that we just got under contract. And this is how I analyzed the deal and found out what we could offer. So let’s share my screen with you. And we go through the whole process and step by step right. So let’s go the first step, find out what the ARV of the property is by using data you have available to you. So right now I do not have MLS access to the property here in Alabama, that we’re working on. By the way, we got this from Google paid ads, pay per click campaign. So I only have prop stream, and Zillow available, okay. So let’s go to prop stream. This is this is Proximus just titled something different, but it’s all the same. So here’s the house.

So I take a quick look at what is Zillow. So Zillow is not always accurate. So I don’t take that as like the gospel. So it says it’s worth 291 400,000. Right? So go over here. And I want to see what is selling around that home. So this is a three bedroom, two bath, 1944 square feet. It was built. And you know your bill is important doesn’t 11 Three, two. So let’s see what’s selling around here. Okay. So I usually want to know, I don’t want to cross any major roads, I want to know what’s selling in the area. Now there’s nothing selling around here for sale right now. So I’m going to look so this is 100k. This is probably a lot. That’s a lot for 175. So 385. So this is a four bedroom four bath for 385. So you can we can go over here to bed. So ours is a three bedroom two bath. Obviously, what’s for sale on this area? So three to use Exactly. Let’s see. So this is a 332 1537 square. Five 2537 square feet for 410 to 70 532. That’s that’s a good competition. It’s passed across the highway, but at least it’s three to about the same square footage for 275. Okay, let’s look at it. When was it built? It was built into this. I mean, so this is a newer build. And it looks clean. I wouldn’t say it’s flipped because it’s a new build, right? But new nice kitchen. Nice stuff. Okay, nice backyard. So 275. So that’s a good comp.

Let’s see how long it’s been on the MLS for now, let’s see. So Zestimate says is worth 302. So now we’re seeing investments are probably a little high in this area. It’s been on the market for one day. So it’s very possible this thing could move quick. So 389 260s is three, three. Now it’s really important when you’re looking at comps, to understand that different neighborhoods could get different, you know, more money. This one seems decent looks. It looks like it you know, they redid a remodel this one some bathrooms. So it’s a 259 and it got a price cut. It’s a little bigger does seem a little you know, like an older build to this one has been on the market and it’s built. Let’s see when was it built might have already passes built construction kitchen you’re building out the data. But this is definitely an older model than a 2010. More Charles’s but it’s gone for about 260. So I don’t know if you know the area where I have the deal is it could be like in a nicer area. So I’m going to keep looking for comps mine says 291. This is 300 and they’re going this one’s going for 275. But I’m kind of gathering just so far that it’s going to be anywhere between the 250 to 300 range, if ARV so let’s see what sold so what we can do here is see what’s sold in the last depending how many days you want, so let’s do the last 90 days.

Let’s see what sold so our home is over here. So this is three bedroom, two bath 2159 square feet is sold for 260. And let’s see when this sold this sold last year. Okay, so 260 That’s a good comp 200-220-6267 So let me figure out exactly where mine is. Again, I like to check
this is the way I know that Reese enters it. Okay, so mine is right there. So 267 202 40 So it’s 200 That’s not good. A good cop for me. But this is also you know, smaller. So 202 40 Okay, so this is a I’m getting some wide ranges, you know, 226 200 this is a good cop for for us. Let’s find out why this was a 200 Even if it’s smaller square footage. Okay, so this is this is why because it was sold two years ago in 2019. So it’s worth it saying it’s worth about 273. It’s, I would I’m saying for I’m seeing from what I’m looking at that maybe the vestments are high in this area, and they’re probably worth like $20,000 Less, according from the Zestimate. So mine says it’s worth 290. Maybe it’s worth about 270 ARV. But that’s something only thing I want to do. I want to log in to prop stream. Check it out. So let’s take this address and do the same thing a prop stream. And then at the end of this, we’ll have a good idea of what the ARV is. And remember guys, we’re still on step one, we’re trying to determine the value of the property. Okay, so next thing we’ve looked at Zillow, let’s look at let’s see, sort of Prop string proxy, this is where 250 That’s probably that’s probably accurate to 50.

Run some comps. So what houses have sold like hers in the area recently. So you all you do is you go to prop stream, type in address and go to comparable and you can change it to public record MLS data, just whatever returns the most data, so I go to public record.
And then I look at the map because it’s really important location is important. So we want to know, what’s the closest one to it. So this is this is good. So there’s this one one once is really close to it. So one sold just a couple months ago, for 250. Okay, and then you can actually look at the picture on here, you see the condition. It looks like it hasn’t been updated since it was built but it looks nice. Nothing crazy. So 250 There seems to be another one right here down to a four. So to solve for 240. And this seems to be the exact match of the property Three, two, it’s a little bit more bigger square footage, maybe that Zillow had the wrong square footage I see. No pictures. Okay. So there’s 225 This is a four for 215.

What’s clean what’s not updated, but clean. So sell it for 215 A year ago so get three, three sold for 225 for two and a half. Let’s see what ours is. Again, ours is two and a half. I think ours is 319 to four square feet so for 225 Okay, so my seller actually I’ve talked to the seller and she said this is the exact layout of the property that she has. So this one sold for 225 into the 20 so almost actually a year ago it Coming up on a year ago for 225. And that’s in clean condition. So the seller actually sent me some pictures of the property. And the home is in good condition. It’s not too bad, it probably needs just clean, maybe some carpet and paint, nothing too big, not a giant rehab. So if this sold for 225, a year ago, and it saved Zillow sales for 220, not 293. Now, I’d say it’s probably worth about 250. Now. That’s right, where and by the way, estimate value prop stream is not always correct, either. But it looks like from what we’re seeing 250 is 250, maybe 262 70. Like in that range is where it could be worse. So next step, figure out the find out the repair estimate through pictures go into the house and or ask the seller so I asked the seller, and she told me it needs carpet paint. Nothing too crazy. So after I find out what the repair, I think the repair SNR home like this is probably like $15,000 I think that’s probably what it’s worth. Now plugin. Next step is plug in the info to the deal analyzer.

Okay, so I’m going to show you guys how to use this. So let’s say the ARB is 250. Let’s just be conservative and say it’s worth 250, I have to get it under 250. For it to be a deal, let’s just say 190. That’s originally what she wanted, was 190 for the property. So you take what you put the price that you get the house for here. And 250 is what the resale value is. So this you need to fill out this information, information here. And the information here and the rest you don’t touch. So right here, hard money, because most flippers use hard money instead of the cash, you have to account they take that into account on when they make their offer. So she should so should we 12% is usually the interest on a hard money loan with two points up front down payment. 15%. The whole time on a property like this would probably be four months you buy it, you’d put carpet paint, you’d relist it, worst case scenarios for months. And then they list they relisted a flipper real estate with an agent for 3% Listing Agent and then 3% For the buyer’s agent. And you can also use this tool sometimes I like to do exact bid. But you can also put the square footage of the home in there. And when we’ve looked at what the square footage is, again, 1924. So you’re here to 1924.

And then you can do what if you think it’s a basic medium, everything. So I went here to basic, it says that the rehab would cost $34,000. Now, these numbers are a little high in my opinion, but that’s just keeps you safe. So you can get a you know, big spread and and be sure of a deal. I really think to do a medium of basic rehab on this house is probably going to cost $15,000. So I think this is a little generous. So I’m gonna go to other. So $15,000. So if I get this house, from her for 190. And I can flip it for 230. If I were buying it, I would make $18,000 18,690 After all my commissions and fees. Now, most flippers want to make between 15 to 20 to 30, depending on the price point of the home, I’d say someone in this that’s going to flip a house at this price point with the risk of you know, taking on the hard money and all that there, they would be okay with making around $15,000.

So that means if I need to get it under 190 to make anything to give it to someone so they can make 18. So I actually negotiated with the seller, and I got her to accept 183 500. So that’s a 25k spread if I was going to flip it, but I’m going to actually found a buyer that was willing to buy it at 205. So this formula isn’t always perfect, but at least it gets you a good idea of where you need to be. So I actually found someone for 205. So he must think the home is worth maybe 270. So he’s going to make his spread. And I have it at 183. So I’m going to make my spread of about 20k or a little bit more than that. So it’s not a perfect science, but I like to, you know, crunch the numbers a couple of ways to say okay, worst case scenario, it’s worth this if I sold to someone a flipper for that much. He’d make probably 2000 bucks for maybe the carpet and paint you only have to carpet downstairs and paint a couple of spots. Maybe it’s actually 5000 So there you go there he makes his spread and A deaf, you know, a 205, he makes money if he sells it for 250. So, let’s, let’s look at it one more time, let’s say the rehab cost is actually 10 grand. Because it, you know, carpet paint is, doesn’t need that much. I sell it to someone for 205. And it’s worth 250, they make 22,000. And let’s say they know something I don’t. And it’s worth 270, they made a lot of money, they made a good amount. So I really believe this property after looking at it 250 is a low end of what it’s worth, I think, you know, if you did a good job, you could probably sell it for 262 70. So it’s very possible, and someone can sell, you know, flip it and make 41,000 I got it 183. So if I was to flip it again, I could potentially potentially make $64,000 in four months. So this calculator is really important to fill out the ARB. You know what you got it for, and you have to include the price that you’re going to, you know, the wholesale fee, so you know what they’re gonna make, because you know, if, let’s, let’s say the property was worth 250. And the house and I got it for 183. Five, and the house actually needed a freaking giant it needed, everything was down to the studs, it was trashed everything.

So this should actually Oh, I’m sorry, guys, I accidentally messed up. I wasn’t supposed to fill on this right here. So let’s do it again. So 250, let’s say the House worked on your 50 I got it for 183, five. And the house needed everything. So if the House knew everything, this guy would lose, I would lose money, I wouldn’t be able to wholesale this. So that’s why it’s important to know the condition of the home, I know from the pictures and talking to her that the house doesn’t need that much work. So worst case scenario needs a basic rehab a 34. And, you know, let’s say I gave it to someone for 190. And the value was actually worth 270. I could make you know, a $7,000 wholesale fee, or, you know, for selling him someone for 190. And they would still make their 15k After putting in $34,000 a word. Now it doesn’t need that much. But again, I’m just playing with the numbers. So that’s how you do it, guys, you mess with the numbers here, you messed up the numbers here. And by the way, let me give you a little trick, most flippers that are good at what they do. They don’t list it with an agent that’s going to charge them 3% They usually have a buddy or know someone that will list their properties for 1%. So that look at the difference if you can, if you’re a flipper, and you can find an agent to list it for less commission. So one from 17. Do you find someone to listen for 1% They’re gonna save money. And if their experience, they either have their own license or they know someone that will sit for less. And it’s possible that they can get bring pay a buyer’s commission of 2.5% instead of 3%. So yeah, there’s there’s always room right, maybe they get their hard money from someone for 10%. And then one point, right, instead of 12 Look they just made that just added a couple extra $1,000. So you know, we play with these bigger numbers just to give everyone enough room, so you’re not making mistakes. But that’s why like, you know, when I originally had this deal to I think those were 250. And I got it at 183. And I was able to sell to someone for 205 is I believe it’s only takes about 15 soon and only take about 15 grand to fix up. I think the guy that we’re gonna go with, it has his license. And he probably gets his hard money for cheaper.

So I think that’s why even at 10k Some people will do it some flippers they think they think maybe I can stretch and make a little bit more money. Maybe he sees this at 260 There you go. That’s why he probably just surprised me able to pay me a whole you know, pay me 205 For the deal, and I can make some money on it too. So you never know. You just want to be safe and I felt like 183 Five was a good deal for anyone. And whether I make you know the 205 or you know that guy bails and I can only sell this home for 190 there’s still room because I got a one a three, five, there’s still room for me to make some money. So use this to crunch your numbers and analyze the deals and let’s go back to the steps on how to do this so I can make sure I’m going through the right That’s Sorry, Sorry
Sorry, I’m trying to get this dang things in the way. See if I can move this area. Okay, so here it is. So after I plugged in the info on the deal analyzer determine what spread you wanted to make I wanted to make, I’d like to make at least 15k on a deal. With this, I was able to make a little bit more.

And then you want to make your all cash offer. So I was able to analyze the deal, find out the ARV, put the repair estimate into the calculator to analyze the deal, and figure out how much I’m trying to make. And I got it under contract. So you got it for 183 Five, found a buyer for 205 I’m going to make what is that? By the way, like we haven’t assigned this one yet, so it’s possible that we could make more on it. But let’s just say we go with the guy 280 205 We’d make 21 Five, right. So that’s how you analyze deals, guys, I hope that was helpful. Use the calculator use this. You know step process is very simple. Just gotta use prop stream MLS data or Zillow to get your you know find out the data and and find out what the ARV is worth. But it’s it’s not a it’s not a science, it’s an art. You gotta as you go, every area is different. Some areas are going to be harder to comp and others but this is the key to figuring out how to analyze and comp deals. Alright guys, good luck.


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