Methodology
How every number is computed.
Pics2Spec separates seeing from counting. A vision model describes what each photo shows: the room, the condition of each element, the problems and their evidence, and what it cannot see. It never prices anything. A cost book turns those findings and your house facts into quantities and low, likely and high dollar ranges. A deterministic deal engine turns the rehab figures and your assumptions into the verdict. Every number in the app opens its formula and inputs.
Data sources
- Photo evidence. Your uploaded photos, analyzed one at a time. Each scope line links back to the photo it came from.
- Cost book. Planning-grade unit costs by repair type, scaled by a regional index, with optional store-priced materials. These are starting points, not bids. Override any line with your contractor's numbers.
- Your inputs. Purchase price, ARV, rent, taxes, insurance and loan terms. When one is missing, the app asks for it and never fills in a default without telling you.
- Comps and third-party estimates. Labeled as such wherever they appear. You confirm them before they drive a verdict.
Rehab
Low, likely and high are the sums of the line items' low, likely and high values.
Rehab budget = likely × (1 + contingency). Default contingency 10%.
Screen
MAO (max allowable offer) = ARV × max-offer % − rehab budget. Default 70%.
Passes when purchase ≤ MAO. A flip can clear its profit target and still fail this screen; we show both.
Flip
Buy closing = purchase × buy-closing %. Holding = hold months × monthly holding (taxes/12 + insurance/12 + utilities + HOA + misc).
Project cost = purchase + buy closing + rehab budget + holding + financing cost.
Profit = ARV − ARV × sell % − project cost. ROI = profit ÷ cash invested. Margin = profit ÷ ARV.
Rental
GSR = rent × 12. EGI = GSR × (1 − vacancy).
Operating expenses = taxes + insurance + 12 × (HOA + other) + GSR × (maintenance + CapEx) + EGI × management.
NOI = EGI − operating expenses. All-in = purchase + buy closing + rehab budget + rehab-period holding + short-term financing cost (0 when bought with cash or the rental loan).
Cap rate = NOI ÷ all-in (on all-in cost). Loan = purchase × (1 − down). P&I from the standard amortization formula. DSCR = NOI ÷ annual debt service; lender-style DSCR = rent ÷ (P&I + taxes/12 + insurance/12 + HOA).
Cash-on-cash = (NOI − debt service) ÷ (all-in − loan).
BRRRR
Refi loan = ARV × refi LTV. Refi costs = refi loan × refi cost %.
Cash left = all-in + refi costs − refi loan. Cash-on-cash = post-refi cash flow ÷ cash left (not shown when cash left ≤ 0).
Wholesale
Spread = MAO − contract price. Viable when spread ≥ fee target. Max contract = MAO − fee target.
Verdict
Wholesale: spread ≥ fee target. Flip: profit ≥ max($25,000, 10% of ARV) and profit still positive at rehab-high. Rental (financed): cash flow ≥ $200/month, cash-on-cash ≥ 8%, DSCR ≥ 1.25. Rental (cash): cap rate ≥ 7%. BRRRR: cash left ≤ 20% of all-in, post-refi DSCR ≥ 1.20, cash flow ≥ $100/month.
Each strategy's margin is the smallest (value − threshold) ÷ |threshold| across its criteria. We recommend the passing strategy with the highest margin and show the runner-up. If nothing passes: "No strategy clears at this price", plus the highest purchase price (rounded down to $100) that makes each strategy work.
Sensitivity re-runs everything with rehab +20%, ARV −5%, rent −10%, loan rate +1 point, and hold +2 months.
Confidence (0–100) weights photo coverage 35%, rehab range tightness 25%, ARV source quality 25%, rent source quality 15%.
Limitations
- Photos only show what was photographed. Areas without photos are listed as not visible and lower the confidence score.
- Quantities are estimated from photos and house facts. Confirm measurements on site.
- Structural, electrical, roof, water and mold findings are flagged for a licensed inspector or contractor. They are never priced as certain.
- Assumptions marked “default — confirm with client” are starting points until you set them.
Estimates are for information only and are not financial, legal or tax advice. Verify every figure with your contractor, lender and advisors.