--- title: "Estimate Every Operating Cost Before You Offer | Addicted to ROI" description: "Insurance at 60 cents a foot, property taxes off the county's reassessment math, renovations by tenant tenure: fast estimation rules for underwriting." lang: en json-ld: | [ { "@context": "https://schema.org", "@type": "Organization", "@id": "https://addictedtoroi.com/#organization", "name": "Addicted to ROI", "url": "https://addictedtoroi.com", "logo": { "@type": "ImageObject", "url": "https://addictedtoroi.com/images/logo.png" }, "description": "Live your best life funded by your investments. Real estate, taxes, travel, and business, by Jennifer Beadles.", "founder": { "@id": "https://addictedtoroi.com/#jennifer" }, "sameAs": [ "https://agentsinvest.com", "https://doorprofit.com", "https://repstime.com", "https://strhours.com", "https://kidspayroll.com", "https://rentstager.com" ] }, { "@context": "https://schema.org", "@type": "WebSite", "@id": "https://addictedtoroi.com/#website", "url": "https://addictedtoroi.com", "name": "Addicted to ROI", "publisher": { "@id": "https://addictedtoroi.com/#organization" }, "potentialAction": { "@type": "SearchAction", "target": { "@type": "EntryPoint", "urlTemplate": "https://addictedtoroi.com/blog/?q={search_term_string}" }, "query-input": "required name=search_term_string" } }, { "@context": "https://schema.org", "@type": "Person", "@id": "https://addictedtoroi.com/#jennifer", "name": "Jennifer Beadles", "url": "https://addictedtoroi.com/about/", "jobTitle": "Founder, Addicted to ROI", "description": "Real estate investor and founder of Addicted to ROI. Built an 8-figure rental portfolio across multiple states and teaches everyday investors how to build passive income.", "worksFor": { "@id": "https://addictedtoroi.com/#organization" }, "sameAs": [ "https://agentsinvest.com", "https://doorprofit.com", "https://repstime.com", "https://strhours.com", "https://kidspayroll.com", "https://rentstager.com" ] }, { "@context": "https://schema.org", "@type": "Article", "mainEntityOfPage": { "@type": "WebPage", "@id": "https://addictedtoroi.com/blog/estimating-costs/" }, "headline": "Estimate Every Operating Cost Before You Offer", "description": "Insurance at 60 cents a foot, property taxes off the county's reassessment math, renovations by tenant tenure: fast estimation rules for underwriting.", "image": "https://images.unsplash.com/photo-1554224155-6726b3ff858f?w=800&q=80", "datePublished": "2026-07-09", "dateModified": "2026-07-09", "author": { "@id": "https://addictedtoroi.com/#jennifer" }, "publisher": { "@id": "https://addictedtoroi.com/#organization" }, "speakable": { "@type": "SpeakableSpecification", "cssSelector": [ ".tldr-answer", "h1" ] } }, { "@context": "https://schema.org", "@type": "BreadcrumbList", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://addictedtoroi.com" }, { "@type": "ListItem", "position": 2, "name": "Blog", "item": "https://addictedtoroi.com/blog" }, { "@type": "ListItem", "position": 3, "name": "Deal Analysis", "item": "https://addictedtoroi.com/blog?category=deal-analysis" }, { "@type": "ListItem", "position": 4, "name": "Estimate Every Operating Cost Before You Offer", "item": "https://addictedtoroi.com/blog/estimating-costs/" } ] }, { "@context": "https://schema.org", "@type": "FAQPage", "mainEntity": [ { "@type": "Question", "name": "How do you estimate insurance for a rental property?", "acceptedAnswer": { "@type": "Answer", "text": "Building square footage times $0.60 per square foot per year, bumped to $0.65 for older buildings or high-risk regions. It's accurate enough for screening; get a real quote once you're under contract, and recalibrate the multiplier periodically since premiums have risen sharply." } }, { "@type": "Question", "name": "Will my property taxes go up after buying a rental?", "acceptedAnswer": { "@type": "Answer", "text": "In many counties, yes: they reassess based on your purchase price. Check the county assessor's site for the assessment percentage and tax rate (or use smartasset.com), and underwrite the post-sale amount, not the seller's current bill." } }, { "@type": "Question", "name": "How much does it cost to renovate a rental unit?", "acceptedAnswer": { "@type": "Answer", "text": "From our portfolio, on an 800 sqft 2/1: roughly $5,000-7,000 for a make-ready, about $9,000 for a medium renovation, and $14,000-16,000 for a full renovation. Costs vary by market; build your own benchmark table and update it against real bids." } }, { "@type": "Question", "name": "How can I underwrite deals faster?", "acceptedAnswer": { "@type": "Answer", "text": "Replace every wait-for-a-quote step with a calibrated estimation rule: per-foot insurance, reassessed taxes, benchmark renovation tiers, standard vacancy and reserve percentages. Verify during due diligence, but decide whether to pursue in minutes." } } ] } ] --- [![Addicted to ROI](/images/logo.png)](/) [Travel](/pillars/travel/)[Real Estate](/pillars/real-estate/)[Tax Savings](/pillars/tax-savings/)[Business](/pillars/business/)[Paths](/paths/)[Blog](/blog/)[Tools](/tools/)[Apps](/software/)[About](/about/) [Login](https://members.addictedtoroi.com/) Subscribe [Travel](/pillars/travel/)[Real Estate](/pillars/real-estate/)[Tax Savings](/pillars/tax-savings/)[Business](/pillars/business/)[Paths](/paths/)[Blog](/blog/)[Tools](/tools/)[Apps](/software/)[About](/about/)[Login](https://members.addictedtoroi.com/) Contents 1. [01 Insurance: 60 Cents Per Square Foot ](#insurance-60-cents-per-square-foot) 2. [02 Property Taxes: Estimate the Reassessment, Not the Current Bill ](#property-taxes-estimate-the-reassessment-not-the-current-bill) 3. [03 Renovations: Read the Building Before You Tour It ](#renovations-read-the-building-before-you-tour-it) 4. [04 The Rest of the Stack, Fast ](#the-rest-of-the-stack-fast) 5. [05 FAQ ](#faq) [Home](/)/ [Blog](/blog/)/ [Real Estate](/pillars/real-estate/) Deal Analysis # Estimate Every Operating Cost Before You Offer Insurance at 60 cents a foot, property taxes off the county's reassessment math, renovations by tenant tenure: fast estimation rules for underwriting. July 9, 2026 8 min read Contents 1. [01\. Insurance: 60 Cents Per Square Foot](#insurance-60-cents-per-square-foot) 2. [02\. Property Taxes: Estimate the Reassessment, Not the Current Bill](#property-taxes-estimate-the-reassessment-not-the-current-bill) 3. [03\. Renovations: Read the Building Before You Tour It](#renovations-read-the-building-before-you-tour-it) 4. [04\. The Rest of the Stack, Fast](#the-rest-of-the-stack-fast) 5. [05\. FAQ](#faq) tl;dr You don't need quotes to underwrite, you need estimation rules. Insurance at $0.60 per square foot per year, property taxes recalculated on the county's reassessment of your purchase price, and renovation tiers read off the rent roll get you a credible analysis in twenty minutes. Verify everything in due diligence; estimate first so you can offer first. Underwriting speed is a competitive advantage. The investor who can produce a credible full analysis in twenty minutes writes offers while everyone else is waiting on insurance quotes, and the difference between the two isn't information, it's estimation rules. You verify everything in due diligence; at the analysis stage, you need numbers that are fast and roughly right. These are the estimation methods I use on every deal, line by line. ([What the finished underwriting should look like is here](/blog/how-i-underwrite-rental-properties/).) ## Insurance: 60 Cents Per Square Foot The most accurate insurance number is a real quote from an agent, and you should absolutely get one, once you're under contract. At the analysis stage you don't have days to wait, and you definitely don't want to be requesting quotes on every deal you screen. My heuristic: building square footage times $0.60 per foot per year. A 10,000 square foot building estimates at about $6,000 a year. For older properties or higher-risk areas (Florida-style natural disaster exposure), bump it to $0.65. Two calibration notes. Don't lean on the seller's declared insurance cost, because who knows whether they're carrying appropriate coverage; underinsured sellers make expenses look artificially good. And premiums have climbed hard in recent years (we requoted our own portfolio and cut 15 to 20% off bloated renewals), so sanity-check the multiplier once per market with a real quote, then reuse it deal after deal. ## Property Taxes: Estimate the Reassessment, Not the Current Bill Here's the costly mistake: plugging the seller's current-year tax bill into your underwriting. That number often dies at closing, because many counties reassess on sale, and the new bill is calculated on YOUR purchase price, not the seller's decades-old basis. The two-step estimation method: 1. Learn how the county assesses. Every county publishes this: what percentage of value they assess against, and how often they update it. It's on the county assessor's website, and every county is different. 2. Find the tax rate. Also on the county site, or use smartasset.com's property tax tool, which is what I typically use. Two real examples from our portfolio: for a 7-unit I own in Holland, Michigan, the county assesses at roughly 50% of determined value (usually the new sale price) with tax rates ranging 1.5 to 4%. In Texas, expect roughly 80% of the recent sale amount at a 2 to 3% rate. Same purchase price, wildly different tax outcomes, and the difference is knowable in five minutes before you offer. If you truly can't spare those five minutes, use the current-year amount, but underwrite knowing it's the optimistic case. On bigger commercial deals I go further and build in an increase cushion; taxes and insurance are the two lines that inflation attacks first. ## Renovations: Read the Building Before You Tour It You can build a usable renovation estimate before ever scheduling a tour, from three information sources: The exterior, from photos or a drive-by (yours or the agent's): siding, windows, roof, exterior doors, the age of HVAC units, sidewalks and driveways, and any slope running downhill toward the building. You develop an eye for this fast. The interior, by interrogation. If there are no interior photos and no access yet, ask the agent three questions: have you been inside any units, do you have any interior photos, and what do you understand the condition to be? Then Google the address, because old for-rent listings with interior photos live forever online. The rent roll, read as a condition report. Two of my reliable assumptions: a tenant in place more than four years almost guarantees that unit needs at least flooring and paint at turnover, and units renting significantly below the others usually means condition is the reason. Then apply per-unit benchmarks. From across our portfolio, for a roughly 800 square foot 2-bed/1-bath: a normal make-ready (paint, some flooring, cleaning) runs about $5,000 to $7,000; a medium renovation (paint, flooring throughout, light fixtures, drywall patches) about $9,000; a full renovation (add small kitchen appliances) about $14,000 to $16,000. Build your own version of this table from your market's bids and keep it current, because the method matters more than my numbers ([and audit what your PM charges against it](/blog/pm-audit/)). ## The Rest of the Stack, Fast Rounding out the estimate sheet: vacancy at 5% for single family, 8 to 10% for small multifamily; repairs and maintenance at 5% and CapEx at 5%; property management at 8 to 10% even if you self-manage; and always verify who pays water, sewer, and garbage, because a master-metered building moves thousands a year onto your side of the ledger ([and RUBS can move it back](/blog/no-more-doors/)). Seasonal costs like snow removal get annualized and staggered monthly. None of these estimates survives due diligence unchanged, and that's fine. Their job is to answer one question cheaply: is this deal worth pursuing at all? Get the answer in twenty minutes, and you'll analyze ten deals in the time your competition spends waiting for one insurance quote. ## FAQ **Q: How do you estimate insurance for a rental property?** A: Building square footage times $0.60 per square foot per year, bumped to $0.65 for older buildings or high-risk regions. It's accurate enough for screening; get a real quote once you're under contract, and recalibrate the multiplier periodically since premiums have risen sharply. **Q: Will my property taxes go up after buying a rental?** A: In many counties, yes: they reassess based on your purchase price. Check the county assessor's site for the assessment percentage and tax rate (or use smartasset.com), and underwrite the post-sale amount, not the seller's current bill. **Q: How much does it cost to renovate a rental unit?** A: From our portfolio, on an 800 sqft 2/1: roughly $5,000-7,000 for a make-ready, about $9,000 for a medium renovation, and $14,000-16,000 for a full renovation. Costs vary by market; build your own benchmark table and update it against real bids. **Q: How can I underwrite deals faster?** A: Replace every "wait for a quote" step with a calibrated estimation rule: per-foot insurance, reassessed taxes, benchmark renovation tiers, standard vacancy and reserve percentages. Verify during due diligence, but decide whether to pursue in minutes. * * * _This article is educational and reflects my own experience and benchmarks. Costs, tax rules, and insurance pricing vary by market and change over time; verify everything against real quotes and county records during due diligence._ Addicted to ROI is education and community, not financial or tax advice. Talk to a qualified professional before making investment or tax decisions. ![Jennifer Beadles](/images/founders.jpg) Jennifer Beadles Real estate entrepreneur with 17 years of hands-on investing experience. Built an 8-figure rental portfolio across multiple states and has helped thousands of investors build passive income through the Addicted to ROI community. The tool that goes with this ## The software that does this for you [ Deal analysis DoorProfit Type in a price and watch cash flow, cash-on-cash, cap rate and NOI move in real time, then save, compare and share underwriting across your whole pipeline. Analyze a deal ↗ ](https://doorprofit.com)[ Agent match Agents Invest Tell us the market and the strategy, and we match you with a vetted, investor-friendly agent who knows how to run a rental analysis, not just sell you a house. Match me with an agent ↗ ](https://agentsinvest.com) Before you close the tab ## Get the next one in your inbox. One email per new article, the day it goes up. No wall, no spam, unsubscribe in a click. [Subscribe, free →](/newsletter/)[Run a deal in the calculator](/tools/deal-analysis-calculator/) Read next [ ![How to Renovate a Rental You've Never Seen in Person](https://images.unsplash.com/photo-1581578731548-c64695cc6952?w=800&q=80) Investment Strategies ### How to Renovate a Rental You've Never Seen in Person 10 min read → ](/blog/renovate-out-of-state/)[ ![How to Determine Fair Market Rent in a Market You Don't Live In](https://images.unsplash.com/photo-1554469384-e58fac16e23a?w=800&q=80) Deal Analysis ### How to Determine Fair Market Rent in a Market You Don't Live In 8 min read → ](/blog/fair-market-rent/)[ ![The Questions to Ask Before You Buy in a Market You Don't Live In](https://images.unsplash.com/photo-1423666639041-f56000c27a9a?w=800&q=80) Due Diligence ### The Questions to Ask Before You Buy in a Market You Don't Live In 9 min read → ](/blog/market-call-questions/) If you like this ## Read these next Hand-picked to go deeper on real estate. 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