Contractors vs Handyman

I have done the same thing and have experienced the same success.

Unless you have a handyman or know someone who is one, you need to make sure you do your research and due diligence in finding a versatile and reputable handyman. There are a lot out there that have neither the necessary skills, or knowledge to be a true benefit to you. You can get referrals from your realtor or by visiting a local do it yourself store such as Lowes or Home Depot.

However you go about doing the rehab, make sure it’s done well and responsibly. Remember it’s your reputation on the line, not theirs.

Cory
Success Academy Coach

Jill & I have rehabbed 42 houses & have done all the work ourselves, except for roofs & central A/C. It's easier to use licensed contractors to pull permits & can do that work much faster.
As for kitchens, baths, paint, electrical & plumbing we take of all that & save a ton of money, which helps beef up the bottom line!

I get asked a lot from students, about what they can do if they don’t know anything how to figure the repair costs. I always recommend that they find a good contractor or handyman, because they can walk through a house with you and have a real good idea what the costs will be by the time you are done. I would agree with the other comments, that the handyman will be the most cost effective and most of your handymen will have a license and will know how to pull permits for the construction side of it. Most handymen will take more time to get the job done, because they are working with smaller groups. Contractors work with big groups and this is why they must charge more.
Finding a good contractor or handyman is easy when you network with your power team. (Realtor) Attending REIC (RE investment clubs) and talking with family and friends when they have work done around their homes.

Best of luck with the rehabs

I have had Union Electricians, Licensed handymen, and a general repair guy that my Property Manager uses for light repairs.

The Union Electricians blew through their work with fast skill and high quality. The Union Contractor had great rapport with the City Inspectors and there was a lot of trust in their work and it showed with everything working and cleaned up at the final inspection. They had a challenging job with removing an old outdoor service panel and rerouting power supply into new panel in the upstairs unit. The property had 60A whole house and was upgraded to 200A whole house with 100A service panels in each unit. The upstairs was converted to complete electricity for heat and Cooking.

I had a great licensed handyman who had replaced my water heater, his price was undeniable and he got the job done quick. He did work on another property though, and I don't know if he was unfamiliar with code, or if mistakenly brought in the wrong material, but he installed single wall exhaust vent for a furnace and water heater. It all had to be tore out and redone. He didn't charge anymore money to do it right, but it did delay getting gas turned on and heat back into the property.

My take on whether to do work yourself or to hire someone will always come down to what you personally know, or how you value your time. I wouldn't hire a plumber to change faucets, toilets, or sinks, but absolutely if I had anything more than 30ft of water supply or DWV to be changed.

The other part is about value of time, if your really, really good at finding deals, then just do that! Find the deals, buy them, and get your crew to work on flipping it. If your average profit was $20K on each 5 houses you did in one year, but after hiring more people to do the work instead, your profit dropped to $12,000 and you were able to get 10 houses done per year your ending up at an additional $20,000 at the end of the year.

Another component of this concept is how much you pay per hour of labor versus how much work gets done per hour. One Contractor could Charge $100 per man hour and another could charge $125 per man hour. So whats the difference? The $100 contractor says 8 hours for a tub install, the $125 says 6. That's only $50 difference between the 2, but a 25% increase in the job being done sooner allowing the next guys to get in sooner! I just wanted to lay this out to help others see past the $125 versus $100. Many times you'll just see the higher price and immediately say "No, the other guy is only charging $100/hr", but is there enough value in that $100 per hour?

Bottom line is you all have your own preference on who to use and the work experiences are all going to be different. I'm planning on using the premium contractors, my experience has been great, the price has been quoted and stayed the same, the job was done when it said it was going to be done, and the final product is of great quality.

I'm not talking every house has to be done like Holmes on Homes, but lets at minimum make sure no one is taking unnecessary shortcuts. I know these shortcuts are being made because the price has been cut down so low.

Just be aware that if you think your contractor is overcharging, think about what your Handyman is not doing with his lower price.

I have been in construction my whole life, building, remodeling and property management.
I am able to rehab a whole house myself if I wanted to so I can save money. But here is the problem, while I'm rehabbing I'm not out finding the next deal. For years when I was doing my own work, I found that I would have to start the cycle over and over again, and I never got ahead.
The cycle:
Buy property
rehab
Sell

Buy Property
Rehab
Sell

I couldn't produce more until I had time to find the next deal. I have changed my philosophy now and only take on the complex Items and sub out most of the other work to trusted sub contractors that I have used for years. I don't make as much on the rehab, but I now make more in keeping the pipeline of deals flowing and having a consistent amount of properties to work on.

Mike
Advisory Team Coach

How many deals are you doing now per year using subs compared to how many
deals did you do per year doing the work yourself?

Hi- I have recently hooked up with a couple of RE investors in my area who are helping me to learn the rehab process. What I am seeing is difficulty in getting detailed bids from contractors/sub contractors. I am giving a scope of work, walking the property with them, explaining what my partners are expecting. Still, I am receiving vague estimates for the work. THis is a big area for learning how to deal with getting bids. Anyone have any thoughts or ideas on how I can get bids done more concisely? The investors I am working with have a team that they consistently use. The idea is to expand the team.

Thanks Martha

I would add to the discussion that it is very important that one check to make sure either one is licensed and insured. Any illegal work is the responsibility of the home owner not anyone else. I always get a copy of the insurance policy and call to make sure the policy is current. I also ask the contractor/handyman to add me when they are doing work on my properties. A scam artist is a scam artist by any other name. Always protect yourself no matter how anal you are looked as. Protection, Protection, and Protection
Ray