There's a simple way to eliminate the stress and worry that comes along with investing tens or even hundreds of thousands of dollars in a property that needs repairs

The San Francisco California real estate market is well known for its consistent lack of inventory...and resulting high prices. 

But despite this huge advantage, 30% of all house flippers lost money in this market in 2006 at the height of one of the best market conditions you and I will probably ever see.  And the average loss was $40,200 - enough to pay cash for an entry level BMW or Mercedes!  So not only were they forced to do a lot of work and manage a lot of stress - but also had to buy someone a luxury car when they got done!

And I didn't make this up.  Its a statistic compiled by a company with 47 years experience in the real estate information industry.....and one that's widely available on the internet.

Its also not a fluke or something unique to only one market in the United States.  In fact, 26% of all house flippers lost money in 2006.  They took an average loss of $16,814.

The reason these real estate investors all lost money at the peak of a real estate boom market is pretty simple.....they paid too much for the property and/or invested too much in repairs because they didn't have a system in place to accurately estimate repairs and determine a safe offer price.

Now I'm not suggesting that they all just "winged it" - most people don't do that when tens or hundreds of thousands of dollars are on the line.  But they almost for sure guessed on at least some costs and likely didn't recognize the impact of others (like insuring a vacant property that's in disrepair).

One real estate guru goes as far as suggesting that you create 3 repair cost price points - say $5,000, $10,000 and $20,000 and just use one based on the condition of the house instead of doing a complete analysis.  His theory is that if you buy the house at the right price, you can absorb unanticipated repair costs and still make money.  This is certainly true in theory - but the reality is, if you bid at this level you'll almost never buy houses.....because someone who does a thorough analysis and knows what a safe high end price is will always outbid you.  Or even if you don't have any competition, your offer will look so low that the seller won't even consider it.

Now I have to admit that I used to use a modified version of the "3 cost" rule myself.  I'd pick a cost range and then make sure it looked like enough to cover the big repairs (like replacing windows and doors) + had some $s left for the minor items (like painting and yard cleanup).  If if didn't, I'd add $s to create an overall repair amount that I was more comfortable with.

But in the end, I was still "eyeballing it."  The result was almost constant worry from the time my offer was accepted thru the time the property was complete.  Would I make a profit?  Worse, did I even have enough $s to complete the project?  Were the finishes I could afford high enough quality to attract buyers or even good renters?

When I bought a property for around 50% of its true market value and based on this method predicted a 30% equity gain.....but ended up with around a 12% equity gain (that would have been almost completely wiped out had I sold the property), I decided enough was enough.  That's when I invested the time to create the Rehab Offer Calculator house flipping spreadsheet.

I started building my house flipping spreadsheet by creating a worksheet for each room I was likely to come across in the course of a fixer upper project....including a worksheet to capture mechanical repairs (like replacing a furnace) and outside repairs (like replacing a roof).

I then included selections for every repair that could be needed for each room.

The idea was to have a tool that would allow me to go room to room and compile a complete, accurate repair cost estimate for any property that I was considering.  So I also needed realistic labor and materials costs lists to work from.

I did a complete review of all the repair invoices I had, called all the contractors I had worked with and did extensive internet searches to gather as much cost data as I could.  Then I analyzed the results and put the most reasonable estimate of each cost in the labor and materials costs worksheets that I had created.

Now I had over a dozen room sheets that needed these costs to perform calculations and I wanted to make sure that I could quickly and easily change any cost.  So I linked all the formulas back to the labor and materials costs sheets....that way if I changed the cost on one sheet it would automatically carry over to every room that it applied to.  I also made sure that any measurements that needed to be input for the calculations were easy to do and didn't require me to remember how to do any type of conversion (like sq ft of carpet to sq yards).  This had to be a tool that I could just pick up and use......even if it had been months since I last used it.

Next I needed a way quickly calculate a safe offer price.  I added the Offer Calculator worksheet and included inputs for closing costs and holding costs to make sure no cost was left out.

Finally I wanted a way to track room by room and contractor costs.....and also simplify the materials ordering process.  I was struggling trying to make complete lists of everything my contractors needed and no matter how hard I tried, I seemed to be making countless trips to Home Depot....sometimes more than once in a day.

I added a Materials Order form that automatically compiles the quantity of each material needed for a project.  I also included the amount budgeted for each material so that I could easily see how the price at the store compared to what I had budgeted for each material.  I added Budget by Room and Contractor sheets so that I could easily see where $s were being spent.....and compare contractor estimates to the amount I had budgeted for each repair.

I now had a tool that I could use to instantly calculate repair costs and determine the right offer price for any fixer upper house.

Click here to see a step by step description videos on how use the Rehab Offer Calculator.

I've been working on the Rehab Offer Calculator for over 5 years and have made a lot of improvements along the way that you'll benefit from.

Most of the ideas for improvements have come from my Users - people just like you who are buying fixer upper properties, fixing them up and creating wealth.  I've received a lot of positive feedback along with these ideas....here are just a few examples.

CONSIDER THIS:  Construction cost estimating software can cost $600 or more, be difficult if not impossible for anyone without 10 years experience in construction to use, and doesn’t have the maximum offer price or rent vs. expense calculators that are included in the Rehab Offer Calculator. 

You could certainly build your own spreadsheet application, but consider that it took me over 100 hours to build the Rehab Cost Calculator ….and I’ve been using Excel every day for years.

Even if your Excel skills are excellent and you could build this spreadsheet much quicker than me (say in 40 hours), consider the cost of your time to do this.  If you earn $40,000/year for example, your time is worth about $20/hr.   Spending 40 hours building  the Rehab Cost Calculator would cost you $800 – even more if you earn in excess of $40,000/yr or don’t have advanced Excel Skills.  And don’t forget that you’d also have to have the same experience I do rehabbing houses….so you’d have to have taken at least one loss on a project, which would likely cost you thousands more!

But you won’t have to spend thousands or $800 or $600 on a tool that will help you avoid overspending on a fixer upper property.  You won’t even have to spend anywhere near that..….the Rehab Offer Calculator is just $99.

AND To sweeten the deal even more, I’ll throw in absolutely free Rehab Offer Calculator upgrades + a free back up flash drive shipped to you at no additional cost. I use the Rehab Offer Calculator in my real estate business so it’s almost guaranteed that I’m going to find other features to add to it – you’ll get these features absolutely free even if I raise the price of the Calculator in the future!  To upgrade at any time, you simple download the latest trial version - it will automatically unlock on any computer that you've installed the registration key on.