House Flipping 101: Step 3 Gather a Team
If you’ve been following our blog, we are providing a brief tutorial describing the steps it takes to successfully flip a home. In our first step, we described how important research is to determine the basics on house flipping, your geographical areas and the economics of your local market. Step 2 brought investors: finding investors is a great way to fund your house flipping project.
The house flipping team is an important asset to your project. By using the expertise of others, it is an effective way to achieve success.
Who Makes Up Your Team
Sometimes, new house flippers want to or feel the need to complete all the rehab work themselves. Sometimes this is practical: a quick update on paint, new carpet, a few repairs. However, many times it is not practical to complete the work yourself. You will spend time completing projects that you do not know much about, spending additional money from your budget and adding time to your project. Hiring a general contractor as a part of your team is sensible. He or she will run the entire project and ensure any snags are met timely and efficiently.
If you decide to be the general contractor of your project, you will need to locate sub-contractors: your electrician, your plumber, your painter, and so on. Sometimes the project does not call for all different trades and therefore it may be sensible to oversee the project yourself and bring in the specific trades needed by your flip. Therefore it will be in your best interest to get to know the specific trades, especially a painter, plumber, and an electrician.
How to Find
You will need to locate a general contractor who can work within your budget and who has a good reputation. Just as networking helped to find potential investors, networking will also help to locate reputable contractors. Find real estate investment clubs to meet with real estate agents, private investors or other individuals who specialize in real estate flipping. Check with your chamber of commerce. Visit the hardware store! Ask around or watch who shows up early to get to a project on time (strong work ethics!). Are you working with an investor? They may refer you to contractors they have used on prior projects.
Keep On Track
Keep in mind that developing a relationship with your contractors takes time. You will need to stay on top of them to ensure the work is being done effectively, timely, and efficiently. You will both need to build trust and communication. Communication is key.
You’ve done your research…you have funding for your project…you’ve gathered your team…up next, we learn how to find a property to flip!