Too much for flip labor costs?

Question

Hi everyone, I'm flipping a 1600 sq foot property and need some help evaluating a rehab bid. Here's the labor bid below.

Keep in mind this is JUST for labor (no materials), and the property is dirty but just needs a relatively simple cosmetic rehab. This is a probably a B/B- neighbhorhood, so we aren't going to get too fancy with this one. (You should be able to click the image to enlarge it. Disregard the colors)

Most items here seem to be 50% too high IMO. What do you think? For reference, I included how many hours each item would take, assuming we are paying $35/hr to our contractor. If you have any opinions on rate as well, please let me know. Thanks!

Bill Kramer · Answer

$35/hour for a guy that has to provide his own tools, vehicle, workers comp/general liability insurance, marketing/advertising AND DO A GOOD JOB?

Your assumption is way off the target. I won't even fire up my van for less than $50, and that's if we have a proven record.

Go to homewyse dot com or home advisor and verify everything he bid if you think he is high. And those sites can be on the low end.

Account Closed · Answer

For one, the numbers don't add up. He is charging $35 per hour and "Clean Appliances and Trim" is 17 hrs at $35 per hour for $600 when it should be $595. and "Ceiling Patch" is 11 hours at $35 is $400 when it should be $385.

You're going to have trouble with this guy. It's not a lot of money, but anybody who rounds up in his favor rather than be accurate is NOT going to take your project or you seriously.

I wouldn't use him - I don't trust him. I don't care if he's the cheapest; honesty and accuracy are essential to our craft. Just "winging it" will cause you to go broke.

By the way, it takes me an hour and a half to install a toilet, not 5.5 hours per toilet.

Bridget Hosey · Answer

You definitely should always get 3 bids so you can judge based on each other’s bids whether one seems too high or whether there is a number that all 3 end up  being close to.

Taylor Chiu · Answer

TLDR - That first bid was too high, we have someone finishing up the work now for 13k

Steven Lowe · Answer

"Installing toilets" is finish plumbing but "remodeling bathroom" is a very broad term and could include a lot of different things--demo, insulation, drywall, tile, plumbing fixtures, electrical, lighting, finish carpentry, HVAC, paint, shower glass, bath hardware, etc.  Important to get details.

Taylor Chiu · Answer

@Bill Kramer

Thanks for the reply! Good to hear some perspective that $35 an hour might be too low.

I will take a look at those websites to get a little snapshot on if he is way off target or in the right range.

So we plan to have a set dollar amount. Not paid by the hour. The only reason I bring up the hourly amount is because I am trying to get a sense for if his bid is too high, which it definitely seems to be at the moment￼.

In the end, I’m sure the best solution will be to get other bids so that we can compare and see what makes sense.￼

Taylor Chiu · Answer

Account Closed What have you seen is the going rate for general flip contractors (not specialists)?

Alison Lee · Answer

I'm a 20++ year professional painter. The 129 hours he billed for painting the ceilings/walls of a 1600 square foot house, is a JOKE. That number should be 75 hours at the top end. He milked it Big Time.

Ed B. · Answer

You've got low skilled jobs like cleaning lumped in with skilled jobs like plumbing and carpentry. They don't all get the same pay. Remember, the bigger the difference between your buy costs and income when selling, the more you can afford to pay for rehab. When you have  a smaller spread, you need to save costs wherever possible. Those numbers you showed look very good for the contractor, but will severely eat into your profit, and perhaps cause you to not make any profit at all.

John Teachout · Answer

Whether those prices are too high or not depends on where the property is. Around here, that would be high but maybe in your locale it's about right (or high or low)

Why are they charging for installing toilets and then charging for remodeling the bathroom. Isn't that sorta the same thing? And if flooring is a separate line item, is that including the bathroom too? If so, what does the remodel cover?

Too much for flip labor costs?

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