Using Our Deal Analyzer to Analyze a Rehab Investment

When that perfect property comes on the market, it can be tempting to pounce on it before having a solid understanding of what the costs involved in the project would be and what kind of ROI you should expect.

Now we know what you’re thinking — “In a market this competitive, don’t you have to pounce, or someone else will first?” In most cases, yes. So the question becomes, how can you be ready to jump on a hot property as soon as it’s listed AND be reasonably sure that it’s a good investment?

The answer, of course, is research. The smart house flipper scopes out the neighborhoods that she’s most interested in. She looks for the types of properties that appeal to her, and then she crunches the numbers. With a little basic arithmetic (or a good accountant) a house flipper can start to build a very clear picture of the type of house that would make a good investment. Once something comes on the market that seems like a close fit, a house flipper who has done their research will be able to act much more quickly because they’ll have a strong sense of what they’re looking for in a good deal.

Now you’re thinking, “Well that all sounds nice, but can we get a bit more specific? What types of numbers do I need to be crunching?”

Glad you asked. Here at ZINC Financial, we have a tool called the Deal Analyzer. This tool is free for anyone to use. Simply plug in basic data about the home, click calculate, and the Deal Analyzer will spit out an array of data to help you determine whether or not a particular house is a good fix and flip investment.

The Analyzer asks for information about the price of the home, the expected rehab costs, the estimated hold time, what percentage of the project will be financed by house flipping loans, the terms of those loans, and the costs associated with taxes and fees, etc. All told, twelve boxes need to be filled in about the house — the whole process should take less than five minutes.

If you’re considering a fix and flip investment, the Deal Analyzer should be the first step in your research process. Analyze as many homes as you like, and when you find one that you’d like to move forward with, give ZINC Financial a call at (559) 326-2509. We can provide new investors with fix and flip funding in as little as seven business days. Call today to learn more.