How to Value a Property with Renovation Potential

Properties needing work can offer excellent value—if you can accurately assess the renovation potential and costs.

The 70% Rule for Investors

Maximum Purchase Price = (After Repair Value × 0.70) - Renovation Costs

Assessing Renovation Potential

Cosmetic fixes (quick wins): Paint, flooring, kitchen refresh, bathroom refresh

Structural issues (major expenses): Foundation repairs, roof replacement, restumping

Value-Adding Renovations

1. Additional bedroom (where zoning allows)
2. Additional bathroom
3. Open-plan kitchen/living
4. Off-street parking

The "Renovator's Dream" Discount

• Cosmetic needs only: 5-10% below market
• Kitchen/bathroom dated: 10-15% below market
• Full renovation needed: 15-25% below market

Check renovation potential on KnowThePrice.