Speed Matters in Real Estate
In competitive markets, the best deals don't last. The investors who win consistently are the ones who can analyze a deal quickly and confidently.
The 5-Minute Deal Analysis Framework
Step 1: Determine the ARV (60 seconds)
Use iComps or your preferred tool to pull an instant ARV. Look for:
- At least 3-5 strong comps
- Sales within the last 6 months
- Properties that match your planned finish level
Step 2: Estimate Repair Costs (90 seconds)
For a quick analysis, use per-square-foot estimates:
| Renovation Level | Cost per Sq Ft |
|---|---|
| Cosmetic (paint, carpet, fixtures) | $15-25 |
| Moderate (kitchen, baths, flooring) | $30-50 |
| Full gut (everything new) | $60-100+ |
Step 3: Calculate Your MAO (30 seconds)
Use the 70% rule as a starting point:
MAO = (ARV x 0.70) - Repair Costs
For example: ARV $300K, Repairs $45K → MAO = $165,000
Step 4: Check the Numbers (60 seconds)
Run a quick profit check. Does this meet your minimum profit threshold? Most flippers target $25K+ or 15%+ ROI.
Step 5: Make a Decision (30 seconds)
If the numbers work, make the offer. If they don't, move on. Don't waste time trying to make a bad deal work.
Key Takeaway
The fastest investors aren't the ones who skip due diligence — they're the ones who quickly filter out bad deals so they can focus their time on the good ones.