Whether you are thinking about your next fix & flip or are a newcomer to the industry, I hope the following do’s and don’ts with fix & flip contractors will aid you in your next project.
Flipping homes is in my DNA, past down by my father’s teachings. He has been flipping for over 40 years, since before “flipping” was a thing.
- Get referrals – From family, friends and others in the business on good contractors. It takes time, but having a contractor that you can trust and rely on will take a lot of the stress out of running a project.
- Hire licensed contractors – One of your first questions in interviewing a contractor should be “Are you licensed and insured?” Check here to verify.
- Have a detailed Scope of Work – Itemize out the work from kitchen to landscaping. Know what your vision is otherwise you will spend a lot of money on change orders as the process unfolds.
- Have an agreed timeline – Your contract should have a completion date. If this completion date is exceeded a per diem penalty should be enforced
- Hire the cheapest contractor – Typically the contractor with the lowest bid has underestimated the job, which translates to him putting your job second to other jobs and the work being sub-par.
- Use the same contractor for every job – Have a handful of contractors at your disposal. This keeps contractors on their toes and prices competitive.
- Pay contractors too early – Contractors will pressure you to pay before the work done. Keep contractors motivated with small material down payments and the bulk of the payment once the work is completed.
- Have one Point of Contact – If you are partnering on a project, choose one person as the point of contact for your contractor. This alleviates the “He said, she said” scenario.
What are your favorite do’s and don’ts with fix and flip contractors? Leave a comment below to let us know!