As real estate investors, we need to make sure that we make money from the properties we get into. This basically refers to the price that we can sell the property AFTER we make repairs and make it look brand new.
If a property can be sold for $200,000, which is the after it’s been repaired and based on my due diligence (ARV, it takes $50,000 to accomplish those repairs. Next, we’ll subtract the repair cost, holding costs, profit, overhead, and all other costs, and that’s how we get to the offer.
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Fernando O. Angelucci is Founder and President of Titan Wealth Group. He also leads the firm’s finance and acquisitions departments. Fernando Angelucci and Steven Wear founded Titan Wealth Group in 2015, and under his leadership, the firm’s revenue has grown over 100% year over year. Today,
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So what is After Repaired Value or ARV is you'll hear some investors say? Well, as real estate investors, we need to make sure that we're gonna make money on the investments that we purchase, or else what's the point of doing this as a profession? So, how we find out what we're able to pay for the property, we actually start from the end in mind and then actually back our way into the purchase price. So what we'll do is we'll pull sold comparables on the market. Anything that's sold anytime in the last three to six months, a similar size bedroom count, bathroom count, comparables. We'll see what they sold for and, we're only using properties that were freshly rehabbed, they're in brand new condition, I mean, literally brand new condition. What that tells us is okay, if I were to purchase this property that needs work, this is what I can sell it for after it's been repaired or after it's been rehabbed.
So what is After Repaired Value or ARV is you'll hear some investors say? Well, as real estate investors, we need to make sure that we're gonna make money on the investments that we purchase, or else what's the point of doing this as a profession? So, how we find out what we're able to pay for the property, we actually start from the end in mind and then actually back our way into the purchase price. So what we'll do is we'll pull sold comparables on the market. Anything that's sold anytime in the last three to six months, a similar size bedroom count, bathroom count, comparables. We'll see what they sold for and, we're only using properties that were freshly rehabbed, they're in brand new condition, I mean, literally brand new condition. What that tells us is okay, if I were to purchase this property that needs work, this is what I can sell it for after it's been repaired or after it's been rehabbed.
So say a property can sell for $200,000 after it's been repaired. And I know that it has $50,000 worth of work that needs to be done on it. So what we'll do is we'll look at the after repaired value that 200,000 we'll then subtract all of our holding costs, we'll subtract our profit and overhead, subtract all of the costs of the transaction. Then we'll subtract the repair costs. And then that is how we get to our offer. So that's what an after repaired value is as what a property will sell for once it's been completely fixed up and is ready to be marketed for a homeowner.
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