Cryptocurrency Q&A
Why is there a 70% rule in real estate?
Why is there a 70% rule in real estate?
Alessandra
Mon Sep 16 2024
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7 answers
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Excuse me, but could you elaborate on the 70% rule in real estate? I'm curious about the rationale behind this principle. Is it a widely accepted industry standard, or does it vary depending on specific markets and conditions? What factors does this rule take into account when assessing the feasibility of a real estate investment? And, most importantly, how does it help investors make more informed decisions?
7 answers
SejongWisdomSeeker
Wed Sep 18 2024
By considering the ARV and subtracting the cost of repairs, investors can determine the maximum amount they should spend on the property to ensure a profitable flip.
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Valentino
Wed Sep 18 2024
The 70% rule is a widely adopted strategy in the real estate investment industry, particularly among flippers who seek to capitalize on potential opportunities.
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CryptoPioneer
Wed Sep 18 2024
The rule serves as a guideline for investors to assess the viability of a property before committing to a purchase.
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HallyuHeroine
Wed Sep 18 2024
According to this rule, investors should not pay more than 70% of a property's after-repair value (ARV), which represents the estimated market value of the property once renovations are completed.
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NebulaNavigator
Tue Sep 17 2024
This approach allows investors to factor in potential risks and uncertainties associated with the renovation process, such as unexpected costs or delays.
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