How to Flip a House Using Project Managers

[Joseph Scorese]

How to Flip a House Using Project Managers

The Pros and Cons of Hiring a GC to Do Your House Flips

In an ideal world, hiring a general contractor (or “GC”) to do all your rehab work is the best possible way to go when you’re house flipping. But that’s only if you can make the numbers work.

Should I Do The Rehab Myself when Learning How to Flip a House?

It depends on a lot of different factors, but the biggest factor of all is you.

Do you absolutely need to do it this way?

I don’t think so. But think of general contracting your first house flip as a bit of “on the job training”. It’s not necessary – but it’s surely an experience you’ll refer back to many times in your house flipping and real estate investing career. If you have a full time job and are rehabbing one house at a time, then you may very well have the time, but this largely depends on the kind of job you have as well.

Behind Door Number 3: The Project Manager

Short of hiring a full blown general contractor, you could use a project manager instead. We’ve found this to be a very effective way to rehab house flips, especially where hiring a GC is cost prohibitive.

Where to Find Project Managers

We’ve found that finding someone young, hungry and motivated is the best profile for success. It may differ for you, but these are the kind of guys (it’s usually guys here ladies) who will put in the extra hours and get things moving in the right direction. Young, ambitious and smart is always a good profile to look for.

Consider the following last minute tips & questions:

◾ Cost and Scope of Project

◾ Your Experience

◾ Your Time and Availability

◾ Profit Margin

You need to screen every contractor in some way, shape or form. From the guy that is cutting the grass to the electrician that is re-wiring the house. You do this to protect yourself because the wrong contractor can wreak havoc on your project.

1. Are you bonded, licensed and insured? Workman’s comp insurance (if he has employees)? – Ask to see the license and for insurance company information that you will verify on your own.

2. How long have you been doing this, how many similar rehabs have you done, have you worked with investors before (does he understand how to flip houses and my needs)?

3. How much of a detailed breakdown will you provide in your bid? Will you create a scope of work?

4. How do you break out your payments?

5. Will you be using your own employees or sub-contractors and how will you pay them? Who will you be using for what?

6. Ask for three references with phone numbers (that you will call).

7. Will you be getting the permits if they are required?

8. When will you start, when do you expect to be done and when is the absolute final date you will be done? – This is crucial if you don’t want your project to drag on forever. Ensure these dates make it on your signed final contract.

Hiring and managing contractors is one the many real estate investing basics you will have to deal with when flipping houses. At the very least you can use these house flipping tips for your real estate investing training and at best they can set-up the success of your house flipping project.