How to Calculate the PERFECT Offer Price for Wholesaling Real Estate

TL;DR

Learn how to calculate the perfect offer for real estate wholesaling deals, including understanding ARV, repairs, and the maximum allowable offer.

Transcript

how to calculate the perfect offer price for your real estate wholesaling deals what's up guys zakin here with flipathrick and yes in today's video i'm going to show you exactly how to calculate the perfect offers on your initial offers for your real estate wholesaling appointments if you're doing virtual wholesaling or regular wholesaling in this ... Read More

Key Insights

• 💯 The perfect offer in real estate wholesaling depends on understanding ARV, repairs, and the MAO.
• ❓ Calculating the ARV involves comparing similar properties on the market.
• 🆘 Gathering estimates from contractors helps estimate repair costs.
• ➖ The MAO is often calculated as 70% of the ARV minus the repair costs.
• 👋 The MAO approach may not always be the best, as there are other factors to consider, such as what cash buyers are willing to pay.
• 🥺 Building rapport with the seller can lead to better offers and successful deals.
• 😘 Aim for a balance between a low offer and not offending the seller.

Questions & Answers

Q: What is ARV and how is it calculated?

ARV stands for After Repair Value and it is the value of the property once all repairs and updates have been made. Comparing similar properties in the market can help determine the ARV.

Q: How can I estimate the cost of repairs?

It's best to consult local contractors and get rough estimates for repairs such as roofing, flooring, painting, etc. This will give you an idea of the repair costs for the property.

Q: What is the MAO and how is it calculated?

The MAO, or max allowable offer, is the maximum amount you can offer for a wholesaling deal. It is often calculated as 70% of the ARV minus the repair costs, but this approach may not always be accurate.

Q: Should I always aim for the lowest offer?

It is not always necessary to aim for the lowest offer. Building rapport with the seller is important, and sometimes a mutually beneficial offer can be reached. The goal is to make a profit while helping the seller.

Summary & Key Takeaways

• Calculate the perfect offer by understanding the After Repair Value (ARV), the cost of repairs, and the max allowable offer (MAO).

• ARV is the value of the property after repairs and updates have been made.

• Repairs refer to the cost of fixing various aspects of the property.

• The MAO is the maximum amount you can offer for a wholesaling deal, but it may not always be the best approach.