Finding the Right Contractor
Contractors play a vital role in your fix & flip ventures, so finding the right one is crucial.
Here’s how:
1. Recommendations from Friends and Family
- Trust those with first-hand experience.
- Remember, a recommendation is a starting point, not the final decision.
2. Online Reviews
- Check reputable platforms like Angie’s List, Thumbtack, and HomeAdvisor.
- Look for contractors with numerous positive reviews.
3. Facebook Marketplace
- Surprisingly effective for connecting with local contractors.
- Engage in conversations and find potential matches.
4. Real Estate Groups
- Network with fellow investors who have valuable contractor insights.
- Learn from their experiences in the field.
5. Home Depot’s Installation Service Providers
- Offers trusted contractors vetted by Home Depot.
- Consider this option for peace of mind.
General Contractor (GC) vs. Subcontractor
- Opting for a general contractor is recommended.
- Managing subcontractors can be more time-consuming and complex. Make sure it is agreed that the GC will manage them, not you.
What if You’re a Contractor?
- Consider doing the rehab work yourself, but weigh the pros and cons.
- Outsourcing allows you to focus on finding more properties to flip.
Selecting Your Contractor
Before committing, follow these steps:
1. Introductory Interview
- Request a resume or portfolio.
- Assess their experience and project timelines.
2. Phone Conversation
- Gauge their communication skills and responsiveness.
- Ensure they can meet your project’s deadlines.
3. Meet in Person
- Building a personal connection is essential.
- Discuss your expectations and partnership opportunities.
- Ask to visit current jobs to look at the cleanliness of the project, drive by unannounced to see if work is being done daily, etc. Remember, your timeline is MONEY!
4. Get a Detailed Bid
- Secure an iron-clad bid with all project details.
- Compare bids from multiple contractors.
- Get an itemized materials list and compare pricing against department stores.
Working Efficiently with Contractors
Follow these steps to ensure a smooth working relationship:
1. Line-Item Everything
- Use a template to document all project details.
- Refrain from misunderstandings with written agreements.
- Never agree on anything verbally.
2. Draft the Scope of Work
- Take charge and create a detailed scope of work.
- Avoid delays waiting for the contractor to prepare it.
- Set a pay schedule with the scope.
3. Offer Bonuses and Deduct Pay
- Encourage early project completion with bonuses.
- Implement penalties for delays to save on holding costs.
- Only pay per scope; never advance funds for anything
- Get releases for each payment.
4. Frequent Property Inspections
- Regularly visit the site to keep contractors on track.
- Ensure they adhere to the project plan.
5. Assist with Material Selection
- Be actively involved in choosing materials and colors.
- Set expectations for your contractor’s work.
6. Potential for Future Business
- Discuss the possibility of future partnerships.
- Contractors appreciate consistent work opportunities.
Final Considerations
- Don’t overwhelm a contractor with multiple projects initially.
- Continue to monitor progress even if you’ve worked together before.
- Seek advice on pricing from experienced individuals.
- Ask questions and demand transparency throughout the project.
- Conduct a final walkthrough to ensure quality workmanship.
By mastering the art of contractor selection and effective collaboration, you can enhance the success of your fix & flip projects in Central Florida. Remember, it’s your investment, and meticulous planning is the key to profitability.
