What Do I charge for consulting on Investors Wanting to purchase

Question

Hey,

I am a Broker/Property Manager, I have flipped a handful of houses, Done gut/remodels, and also purchased and manage 19 of my own units.

I have an investor from out of state who wants to invest in this area into multi (likely 8+) unit buildings.

He is looking to have me be his go to/on site guy.  I would be going with the agent to look at the properties and inspect them, Contacting people to find out expenses/ etc, and doing all the numbers crunching, and reporting that stuff back to the investor.

Wondering what I should be charging for such a service.

I was told maybe an hourly rate for time invested, weather it be in office, or in the field?

I should also add that, I will then if He purchases these properties be the Property Manager for them.

But I have that cost breakdown pretty much figured out already.

Any input would be greatly appreciated!

Thanks Guys!

Keep Investing towards Freedom

Jay Hinrichs · Answer

@Jacob Smith thanks for the offer I will in fact be at Pewaukee lake Thursday thru Sunday and going to the state fair.. it been 30 years since I have driven up your way.

I bought a Cirrus in Duluth in 04  and spent a week flying around N Wi in transition trainging and landing at a bunch of the airports there went into Oshkosh flew over packer stadium etc.

fond memories.

one idea you may have to scale is take these clients and bring them on as equity partners.. you do source manage do rehab work etc in exchange for equity and they go on the loan with you.

I built a pretty big portfolio with this model.. got up to 350 doors then sold out in 2013. but if you have good cash flow there and your totally under the radar.. I bet this model would work there.

Jay Hinrichs · Answer

I think if I was in your shoes I would do a lump sum bid.. like engineers etc do.. come up with what you think the time amount will be add in what you feel your time is worth and charge a lump sum consulting fee. .this way you don't have to account for anything and if they agree they pay you and then that's fine.

On another note.. I was waiting for some one from this area to post.

My grandparents owned a cottage on lake Poygan out of Winneconnie.. I used to go there in the summers circa 1963 to 1966.. I learned to fish there.. how to shoot a gun.. how to drive up to a dairy and buy the best cheese on the planet.. what smoked meats and brats were all about.. along with corn on the cob being sold like they use to sell on the ice cream trucks were I grew up in San Jose CA.  and what most of all two things.. One of my business partners was born ( maybe not born there but raised there and bound his way to CA) and my grandfather brought me over there and he bought me my first pellet gun.. !!!  So heres to Omro Wisconsin.. and the memories.

Keira Ingram · Answer

Hi @Jacob Smith, I provide similar services to my out of state investors including overseeing repairs and renovations.  I charge $125/hr for inspections, comps, administrative support, getting estimates from vendors, and number crunching.  For overseeing repairs and renovations I charge 15-20% of the repair invoices.  I provide my investors with invoices that explain all charges.

Jacob Smith · Answer

yeah, the EAA air show is going on right now! Planes planes and more planes!

Equity partner... I like the sound of that!  Let's connect more privately and I'd like to learn more if you would be willing to teach me more about that idea.

Keira Ingram · Answer

@Jacob Smith   On the 15-20% its based on bills (labor and materials), luckily I have built a strong team of contractors and handyman so I get the best prices possible.  And when I am managing a project I only charge the 15%-20% anything outside of that, I charge a hourly rate.

Jacob Smith · Answer

that is awesome Jay. I grew up in Neenah! Have lived in Omro for about 7 years now, less than a mile from the infamous"cheese house".  Like it here a lot! Great community!

Thanks for the input, so hard to decide.

I set him and on a listing cart of multi units. Where we both get the postings. Some of the challenging part to this is although my bank won't let me invest in any more this year I love looking at them anyway. And I really enjoyed crunching the numbers to see if properties actually make money.

but need to think of it in a business sense also that my realestate understanding what I've learned and my broker's to be able to look and manage are worth something. :)

Btw, if you ever happen to want to come out this way I'd love to host you give you a place to crash, etc! ;)

Jacob Smith · Answer

wow, thanks Shakeira! I guess I am way too generous. I was thinking way less hourly.

on your 15-20% is that on contractor bills as well as materials? So do you pay those out, and then re invoice it out.  Cause likely i may be acting as project leader/general contractor if there are any large repairs needed.

Thanks for the input!

What Do I charge for consulting on Investors Wanting to purchase

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