Foreclosure Cleanup: The Easiest Way to Price Foreclosure Cleaning Jobs

There are several ways to price foreclosure cleaning jobs. The method discussed here is a very simple, straightforward one because all you have to do is figure out your costs and job markup.

Add costs to markup and that will you give the “what to charge” amount. The formula looks like this:

Direct Costs + Indirect Costs + Markup = What to Charge

Foreclosure Cleaning: Example of a Job Priced Using This Formula

Job Particulars: Say you are asked to submit a bid on a job for a simple trashout and cleaning of a house.

Cleaning particulars: Not a white glove clean, but a broom-swept and major appliance clean (eg, clean tub, toilets, refrigerator; sweep floors; dust cobwebs).

The home is a 2-bedroom, 1 bath, 1,100-square foot ranch. The job should take approximately 5 hours. Once you look at it, you know that you need to rent one small dumpster for the day. That will be enough to carry everything away.

For the cleaning, as it’s not white glove, you only need one person. For the hauling, you need at least two guys because there’s some heavy stuff — dressers, an old refrigerator in the garage, some mattresses, a bookcase, etc.

Estimate Time to Complete Job: 5 hours

So to cost this job out, let’s look at what your direct costs will be:

Dumpster Rental: $300

Disposal Fee: $75

Cleaning Crew: $75 (1 person, $15/hour x 5 hours)

Moving Crew: $150 ($75/day rate x 2 workers)

Misc Cleaning Supplies: $50 (broom, garbage bags, gloves, pine sol, masks, etc.)

Direct Foreclosure Cleaning Costs Total: $650

Now, let’s add in your indirect costs.

Let’s pretend that you know that all of your indirect costs are $2,000 per year (insurance, phone bills, gas, office supplies, etc.).

And, let’s say you plan on doing at least one job a week, starting part time. So, your indirect costs per month are $166 ($2,000 / 12 months).

So your indirect cost for each job is $41.66. So you would figure that into the job estimate.

Indirect Foreclosure Cleaning Costs Total: $41.66

Now you have two of the three figures you need. Let’s say you decided that you want to operate at a 35 percent markup (that is, you want to make at least a 35 percent profit on every job you do). This is different for each person and is discussed in detail in the next chapter on soft pricing.

To get the third figure — the profit — you multiply .35 x 691.66 (41.66 + 650). That’s $242.08. Not bad for four hours of work on the weekend.

Percentage of Foreclosure Cleaning Job Profit: $242.08

Totals: $242.08 + 41.66 + 650 = $933.74

Foreclosure Cleanup Bid Amount: $935 (rounded up to the nearest whole $5 amount).

Learn more about how to price foreclosure cleaning jobs.

May be reprinted with the following, in full: The above was excerpted from The Pricing Guide for Foreclosure Cleaning & Real Estate Service Businesses: How to Price Jobs for Profit. Learn everything you need to know about how to price foreclosure cleaning jobs, which can be found in this ebook at http://Start-a-foreclosure-cleanup-business.com.