I have a rehab going on right now.
Yes, I usually just wholesale.
But sometimes I rehab too. (I’m just super selective these days.)
I always budget in 15% as a fudge factor to my rehab costs.
I never want it to get spent, but it almost always does.
Because there is ALWAYS a skeleton in the closet.
Something wrong that couldn’t be seen during inspection.
Something that eats up money like an alligator.
You never know in advance what specifically it is going to be.
But you always know it is going to be there somewhere.
It’s like a haunted house at Halloween…
You know there’s going to be a scary ghoul around the next corner, yet you don’t know exactly what it is until you actually get there.
This time (and we ain’t finished yet) it was the plumbing.
When the old kitchen got ripped out the piping was an utter and complete mess. It had been patched multiple times in the past and the parts that were still original weren’t looking too healthy.
So $5,100 down the tubes.
(Or more accurately: ON the tubes)
Not a pleasant expense.
But needed to be done because it was the right thing to do.
That’s the way rehabs roll.
And that’s why you always need to plan for worst-case scenario, not best-case.
And while that’s obviously true for rehabbers, it is true for wholesalers as well, as they need to be sure to account for the skeletons in their repair estimates otherwise their numbers will be too low and it might kill the deal.
How to get it all right?
You need to know what you’re doing.
And the way to know that is to get trained properly.
Start with my 1-day Rapid Cash Generator MasterClass event this Sunday.
Learn to expose and deal with all the hidden skeletons here:
Traction Real Estate Mentors