Why real estate? understanding value and building wealth the steady way

In real estate investing, we’re not chasing the hottest deal on the block or the quickest flip for the biggest win. Sure, those happen, but if that’s your whole business plan, the risks add up fast. Many investors who built on hype have already burned out, went under or moved on to the next “can’t-miss” hottest trend.

What’s great about real estate is that it’s real. You can’t fudge it, and nobody can pull the rug out like in stocks or crypto. You’re in control of the asset, the improvements, the management, and ultimately, the outcome. That control is what allows you to build long-term, sustainable wealth instead of just getting lucky once.

How to Find the True Value of a Property (residential)

Every good deal starts with knowing what a property is actually worth, both now and after repairs. This is called the After Repair Value (ARV), and it’s your foundation for deciding what to pay and how much you can profit.

1. Start With a Realtor for Sales Comparables (Comps)

A good realtor can pull comps, or recent sales of similar properties in the same area. Size, condition, and location matter most. These real-world numbers tell you what buyers are actually paying, not what sellers are hoping for.

2. Use Automated Valuation Models (AVMs)

Platforms like CoreLogic and Black Knight use massive datasets to estimate property values. They’re not perfect, but they’re a fast, reliable checkpoint — especially when you’re screening multiple potential deals.

3. Cross-Check Online Estimates

Look at Zillow (Zestimate), Redfin, and Realtor.com. These public tools provide broad estimates that, when combined with your comps, help validate your numbers and reveal market patterns.

4. Do Your Own Price-Per-Square-Foot Analysis

After collecting all the data, run your own analysis.

• Focus on homes within ±200 sq. ft. of your property’s size.
• Calculate the price per square foot for each comparable sale.
• Use that range to estimate your property’s current and potential value based on condition.
• Like-kind properties- don't try to justify your analysis by using a totally different property look vs your subject property.

This gives you a strong, reality-based range for your offer price, not guesswork.

Determining What to Pay

Once you know the ARV, work backward to find your maximum allowable offer (MAO).

A quick formula most investors use:
MAO = (ARV × 0.75) – Estimated Repairs

That 25% buffer covers holding costs, transaction fees, and your profit margin. If you’re buying rentals instead of flips, analyze the deal based on cash flow and cap rate to make sure it still performs long term.

Final Thoughts

Real estate isn’t about speed, it’s about strategy. Knowing how to calculate property value and buy right is what keeps you in the game long after the trend-chasers are gone.

You may not control the economy, but you control what you buy, how you improve it, and how you manage it. That’s what makes real estate one of the most proven, reliable paths to wealth; slow, steady, and real.