Do contractors hate all flippers?

Question

I ran across  a YouTube video that surprised me. I’m one of those starry eyed beginners hoping to make a name for myself in real estate fix and flips.

It was the comments that made me turn my head! Contractor after contractor throwing flippers under the bus, lumping them together and generalizing.

Do I have to be a J.A. cheap skate underpaying my team and selling second rate craftsmanship to make a profit? Or are there contractors out there with fair prices that love working with flippers??

Eliott Elias · Answer

More flippers hate contractors than vise versa. Your communication dynamic and keeping each other in check is crucial. Being a novice investor is not the end of the world.

Evan Polaski · Answer

@Emily Haase, no.  Good contractors will quote you their price for the work.  Now if you are continually trying to nickel and dime them on things, yes they will come to resent you.

Like any relationship, if you can find what each contractor values, and match those with your projects, you are setup for success.  I.e. one of our favorite contractors loves doing custom work and figuring out how to execute unique ideas, i.e. wrapping our island with a custom tambour finish.  He loves this kind of work, so likely charged us far less than others would have, who would rather work at volume doing the same thing over and over.

At the end of the day, if you have a healthy budget with lots of reserves, your contractors will generally not hate you.  Pay them what they quote, don't pester them too much, but hold them accountable to their quotes and timelines.  If an unforeseen issue arises that is not their fault, you pay for it.  And if they resent you for paying the price they quoted, then you don't want to keep working with them anyways.

Alecia Loveless · Answer

@Emily Haase My contractor would move the world for me if I asked him to. However he would likely stop working for me if he found out I had him rehab a house and then turned and flipped it. Where he put in like 600 hours of work over a three month period or so. Unless we worked out an arrangement for a profit share at the start.

If I bought one where I did most of the work and it was primarily cosmetic which I could do myself, I’m not handy, and just had him come in and do one or two things he’d probably be ok with that.

He’s all in favor of me building a portfolio but I know he’d be upset if I didn’t keep something he’d spent months and months working on and then made a big profit off of. He’s really looking forward to me having enough properties to quit my W-2 and start helping with the stuff I can do now and learning to do some more stuff so we can go faster.

Chris Seveney · Answer

@Emily Haase

Contractors hate novice flippers. Why? Because they do not understand construction, they won’t pay change orders, cannot make decisions and if they act as the GC do not know how to schedule work.

Bill J Fay · Answer

There are contractors that hate flippers and there are contractors that love them. Be open with what the intent of the project is. The contractors that love investors that flip love that fact that they aren't dealing with a homeowner. It's a business focused relationship rather than an emotional one that comes with working on a personal home. The contractors that hate flippers are the ones that undercut them at every move. Waste their time and go cheap on certain aspects that need attention. You'll eventually find many contractors that will love to work with you if you treat them fairly and keep work coming in.

Napoleon DeCiutiis · Answer

Emily, You have the formula right on YouTube.  Contact your GC, and let them know all the concerns they may have using the words from the video.  Explain to them how you aren't going to do those things and ensure that you don't.  Focus on taking care of the people who take care of you, and you'll be successful.  But if you take advantage of them, they'll back out from underneath you and leave you hanging.

Jim K. · Answer

My plumber put it well, once. Understand the general flipper's goal -- to maximize his profit. Understand the general tradesman's goal -- to make a name for himself by building a client list that treats him well and recognizes the value of his work. The work the tradesman spends on a flip is not work spent on building such a client list.

Andrea Lane · Answer

Many contractors do not like working with flippers. Flippers underestimate jobs and then expect a top contractor to do the work for peanuts.  You can find a good contractor to work with you on a flip.  The problem is usually the flipper creates cheap estimates to make a deal work.

BEFORE YOU PURCHASE - create a good repair estimate

- there are many resources to teach to repair estimations and deal with analysis, use them

- Don't put in $4,000 for materials in the budget (because you can do the work yourself) and then look for a contractor to do the work at that price.

- If you have never done the work, ask a contractor to give you an estimate (as a newbie you may pay for this service and s/he can take it off his bill)

- build relationships with contractors

Your rehab should provide income to contractors as well as you and I think many rehabbers/flippers forget that.  A good contractor willing to work with you over and over again is worth his/her weight in gold.

Do contractors hate all flippers?

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