Choosing the right contractor for your fix and flip project is critical to its success. Hiring the wrong real estate contractor can seriously detriment your project and negatively affect deadlines. Second only to the investor, the contractor is the most essential part of the flipping process and directly impacts how profitable the project will be at the point of sale.
About hiring and vetting the right contractors
Recommendations Are Key
A high-quality contractor will be professional, knowledgeable and licensed with covered by insurance. When vetting contractors, they should have contactable references and a portfolio of previous work for you to view. The best way to find reliable contractors is through recommendations; friends and family who have recently done remodelling or building are a good place to start. The internet is another great resource – you can advertise on contractor marketplaces and search for options. Going online to check references and reviews is essential to shortlisting candidates – websites like Yelp, Thumbtack and Google Reviews should be a focal point in your search.
The National Association of the Remodeling Industry should also have a list of pre-screened contractors available in your area. If you’re making use of a building inspector for your property, they can also refer you to renovation contractors they know from previous projects.
With a shortlist of potential contractors in hand, you should start contacting their former clients and asking their opinion of the contractor’s work. If possible, you should try to visit previous job sites, or ask to see photos of the finished project. Questions like whether the job site was safe, the renovations were done on time and the quality of work is key and should be ascertained. As the investor, you should also pay attention to how long the contractor has been in business, and in what role. For example, is the majority of their experience as a subcontractor or as a site supervisor?
You want to be sure to hire someone who will be qualified to handle the job. The ideal contractor will have their own dependable network of subcontractors, suppliers and other individuals they trust to work alongside them on the project.
Get Multiple Options
Looking at what is best for your own project, it’s best practice to vet multiple contractors for safety. Your top pick might be unavailable, so you’ll want multiple options to work with before settling for one.
A good contractor will want to see the property’s blueprints and sit down with you to plan what needs to be done and how much it will costl. You should ask the potential candidates you’re considering to list the cost of materials, labor and other expected expenses that come up while renovating a home. For reference, the national renovation cost average ranges between $18,448 – $75,554 depending on the type of property. It’s also essential to get everything in writing, specifically, what is to be done, start and end dates for construction and total estimated costs. If you can build in penalties for late delivery of work, that can serve as a great motivator.
Be Wary Of Low Prices
Remember to be wary of prices that seem too low. While a deal is always great, beware of the contractor with the lowest offer, as they might end up costing you more. Those contractors who are wildly underpricing their competitors by a great deal may be cutting corners to make up the difference, or not have the experience to finish the project successfully. Remember the old adage; if it sounds too good to be true it probably is, and that applies to contractors too. A good contractor is worth paying the price for, and you should feel comfortable putting your project in their hands.
It’s also good to think long term; if you find a reliable contractor, it can be a mutually beneficial relationship if you use them for future flip projects, and it will save you the time of screening for someone new.
The right contractor will make a world of difference to your fix and flip project. Reliable contractors can be found through recommendations from family, friends, by going online or through professional remodelling organizations. When searching for the right candidate, it’s best practice to find multiple options to compare in case one is unavailable. Once a good fit has been found, a long term and mutually beneficial relationship can begin.