Tips on Hiring a project manager or contractor for your next rehab.

We can all buy cheap houses! Can we all rehab them for a profit? People say work smarter not harder so hire it out. For investors they are right to some regard. When it comes to your investment rehab it’s imperative that you choose your construction team wisely. Rehabs are labor intensive and your contractor or project manager is going to want a fee for his time and efforts and it’s up to you “The Investor” to qualify him. Here’s some questions to ask yourself and your potential manager.

Here’s a given.

“Your manager or contractor should have a fluent background of investment properties and a passion to provide the community with a quality home that increases the end buyers standard of living.”

“Your manager or contractor should have a residential builders license in the state you are operating in.”

This is very important….. Here’s why. PERMITS… This is your investment so playing by the rules provides smooth sailing. When a contractor or manager needs to pull a permit for a Certificate of Occupancy, roof,  general or structural repairs don’t pay extra to for a permit puller. Out sourcing this task can cost you time and money as well as loss of control of your project. Also, your permit puller would now have the right to lien your property. Here’s a quick example: You hire a licensed contractor to do your full rehab. You need a roof and your opening up a wall that requires an install of a structural header. Your contractor pulls a permit for both items and has guys at his disposal to tear off the roof, re-shingle it, and install the header membrane as needed. He then calls in the inspections. Done! Easy as that with no hidden expenses. Or….You hire an un-licensed contractor or manager and while he’s still trying to decide if a permit should be pulled he’s shopping prices and doing the demo. As this is all happening the city drives by and sees your dumpster and puts a stop work order on the window. Good luck finding your licensed contractor now and happy rehabbing.

“Your manager or contractor should have a system in place to cost EVERY SINGLE TASK that needs to be done in a home prior to you closing.”

This is for your protection. You need this data to justify the expectation of repairs and the features your property will offer in comparison to current ARV. Putting together a detailed list of tasks to be completed is the first step to a successful rehab.

“Your manager or contractor should be able to do every task in your project if needed.”

Is he or she is You tubing how to install a window? If so, your in for a treat. Picking colors is one thing and operating production crew is another. Having a full understanding of the whole construction process is a must. The manager should have a full scope of work for the subcontractors. Use FULL DETAILS. This will eliminate corners being cut and will provide the best bang for the buck. Subs should show up to work, not price it out. It costs money and time for the sub to drive to your property, price out your project, and make his own scope of work. Bottom line… your going to pay for that. Your manager should need to do minimal shopping for trades and workers. They should personally know how to do every project themselves. This gives them the qualification to oversee and participate in the project. I know we are all experts because we know an expert but your project manager should be your expert. Remember this is your investment.

“After completing a few hundred full rehabs here’s a tip for you.”

“There is always a corner for a sub or worker to cut that will save him time or money that  may go unseen unless your manager or contractor knows his stuff and is present.”

I could tell you at least 10 things that could be quality installed in front of an investor/contractor/manager using corner cutting techniques that wouldn’t be caught by the un-knowledgable. Don’t be a victim.

Enjoy “Turning Property to Profits”