Forty wholesaler emails a week, and their ARVs running 11 percent high on average

The uncorrelated rehab numbers point is the most useful thing in this thread in a month. A wrong number that's wrong in a consistent direction can be adjusted for. A wrong number that's random is just noise wearing a dollar sign.

A basic clarifying question is worth asking here. When someone says ARV, that is the value after repairs, so it is a forecast of a sale that has not happened yet. Is there any way to check a wholesaler's number other than running the comp pull yourself, or is the whole exercise just two people's opinions with a contract in between?

@raj_mehta14 it's two opinions and the one who's wrong pays for it. Which is most things in this business.

Sextant, 3 out of 178 is a 1.7 percent hit rate. If the first look genuinely moves that to 4 or 5, the $2,500 is cheap. If it moves it to 3, you've paid $7,500 for nothing. Can you run it for a quarter with an agreed end date rather than an open arrangement?

Slow question. Has it been checked whether the fourteen accurate ones are accurate because they're better, or because they happen to work a market where comps are dense and easy? A tight subdivision with forty identical houses makes anyone look like an appraiser.

@ehernandez74 that's a real effect. I'm going through licensing right now and the first thing that gets drilled is that comp quality is a function of the neighborhood, not the analyst. A 1920s street where every house is different is hard for everyone.

Sextant, do you know if the accurate ones are pulling MLS closed data or scraping public records? In non-disclosure states the sale price isn't public at all, so anyone working from public records there is guessing at the input.

The under $250,000 tier problem described here is the whole pitch heard from the other direction too, that institutions won't touch occupied properties or heavy rehabs or messy family situations. If that's where the individual operator's edge is, then wholesalers sending clean cosmetic houses under $250k are competing in exactly the place they can't win.

Curious whether the 11.4 percent average is stable across the year or drifting. If their ARVs got more optimistic between October and now, that's a statement about their market read, and it'd show up in your spreadsheet before it shows up anywhere else.

At the low end of the price range, the spread between an accurate ARV and an optimistic one is often less than the cost of a new roof, which makes the whole exercise feel different. Everything described here gets sharper as prices rise.

A vendor who charges for access is usually the one who is out of leads, and running a business for years tends to teach that lesson. The two offering a first look for a success fee are signaling they would rather have one reliable close than six tire kickers, which is a normal thing for a small operator to want. Testing one of the two against the other, with a spreadsheet already in place to measure it, would answer the question directly.