For those of you experienced in rehabbing houses, what works best for you in terms of hiring the people to get the job done?
Do you use a general contractor to manage the project for you? What’s a reasonable price to pay for this service? Do you feel that you save money or time by having someone manage the rehab for you?
Or, do you run the project yourself and hire your own contractors? Do you prefer to use licensed & bonded contractors or do you look for moonlighters?
I will give you my two cents worth. When I was doing a lot of deals in East Austin I was getting grants from Hud to remodel properties. There were deals everywhere and I had excellent credit. I could have done hundreds of deals with probably a million in grants. Instead I did my own remodeling and including even the hammer and nail thing. I did hire some helpers but I got too bogged down in the remodeling and missed the big picture. I was a lot better at finding deals, financing, getting the grants etc than remodeling. I am a great contractor but misssed the boat trying to save a little on each project instead of lining up projects.
It just depends for you today if you are in the same boat. Do you know enough about construction also. If you are better at finding deals amd there are enough for you to line up then hire someone, even me. I was too cheap and thought I was saving money by doing the work myself. The cost today depents on the size of the project. I would try to make 10 to 15 % profit on 10000 dollar jobs and charge about $20 per hour for carpentry, elect, plumbing. painting, wallpaper, etc jobs that I do. There was a post a while back by a contractor and he looked like he would be a great contractor too. Hope my experience helps.
I can’t tell you how many times I hear “I can do that,” when the person really can’t. It’s hard for any of us to admit our own shortcomings; but, so important to recognize our own strengths and go with those. My dad taught me long ago that a good manager hires the person who can perform a specific task better and let him do it.
You hit on the crux of the debate going on in my head–will I be better off saving money on this deal by lining up the work myself, or by hiring someone to do that work for me so I have more time to go find more deals?
I would guess this is a question every rehabber has to figure out for themselves base on their strengths. Since I’m fairly new to this, I’m not sure I know which route is right for me yet. Maybe I’ll have to try both!
I am a project manager by nature & by training, and I have some past construction experience, so I think I’d do ok managing a rehab on my own–although I’m sure I’ll have a lot of lessons to learn. As you pointed out, though, I have to consider how many deals I could find if I had all that time freed up.
Hopefully others will post their experience with this topic–I’m eager to hear more.
I am one of those people that has to have a project going at all times, so when I bought my first fixer last year I planned on doing the work myself. Unfortunately, after getting started, I realized that although doing all the work myself was possible, it was going to take me 8 months to finish - my goal was 1 month to fix, 2 to sell. The only MAJOR problem I had was that I bought it WRONG and if I paid contractors I would lose tons of money on my first deal - and I refused to do that. I ended up hiring some stuff out and found some good guys for future work (in addition to finding guys that were HORRIBLE and I had to spend hours fixing their mistakes) and basically broke even. The handyman guys weren’t licensed, bonded, insured but the major stuff like HVAC, electrical and plumbing were.
I am now closing on my 2nd fixer (I’m obviously not on the fast track!) and bought it with full intention of hiring it out with me acting as general contractor. Hopefully I bought this one right!
I’ve been holding off on answering your question because you know where I stand.
I’ve told you I think you can do it yourself. It’s not as hard as you think. Go for it and see what happens. The worst that could happen is you end up hiring the GC after a few weeks of doing it yourself.
If it’s an ugly house to begin with you’re not going to do any more damage to it than has already been done. :thumbsup