Renovation - get a contractor or be my own?

Question

Hey folks, got a good deal on a house in a very hot neighborhood that is going up in value quickly. It needs at almost total renovation (siding, roof, and some floors are the only things that DON'T need major work right now). It's a little over 900 sq ft, so it's a reasonable size. I will be holding this house as a long-term rental.

I am brand new to doing this, and don't swing a hammer myself, so I'll be relying on hiring people. I have lots of friends in the business who are more than happy to refer me to people with good reputations, and I know how to get multiple bids on jobs.

The property is a mile from my house, so it would be easy to go over there multiple times a day when I need to. I am self-employed with a flexible schedule.

My first impulse was to get a contractor to oversee the whole project, but as I look at the numbers in would save me a ton of cash to oversee it myself. It's a little overwhelming since I'm new to this and have so much that needs to be done. At the same time, I have to learn somehow, as I'd like to grow my rental business in the future.

In the Good/Fast/Cheap equation, I don't need it Fast (not carrying a mortgage or construction loan, so taxes/insurance/lost rental income is the only downside of taking a long time), but I'd like it Good and Cheap.

Am I foolish for thinking I can oversee a project of this magnitude? What newbie resources would you point me to if I undertake this? If you did the same when you were starting out, what did you wish you would have known, and done differently? Thanks!

Ramon Jenkins · Answer

I totally agree " Time is money "

light rehab : sub work yourself

permits / medium / heavy rehab : hire general contractor

Patrick T. · Answer

I'm a GC myself.  If you're doing anything that would require a permit, you really should take it seriously.  Owners can usually pull their own for most types of work.  Work with the planner and inspector. They make sure you do things right, and tell you if you should hire someone.  If you can't pull your own permit, there is usually a good reason (read "some danger").

This is your investment, and other peoples safety.  You don't want anything to go wrong with either.  And if the insurance company is looking for an out, owner DIY's with no inspections are are good grounds.  Even if there is no claim, you are eternally responsible for that work, day & night.

Get some references if you need a contractor.  There are lot's of resources.  Hook up with one who you like (people really appreciate us when they know us). Watch them closely, learn what they actually do, and make this decision after you get some experience.

Matthew Paul · Answer

Thats how the GC makes a living , if they didnt  "jack up" the price they would be working for free .

Shanequa J. · Answer

One of my rental properties was a quick cosmetic fix. It needed cabinets, toilets, vanities, plugs, blinds, paint, flooring, blah, blah, blah. I thought "why hire someone when I can get all of this done in less than a month". I got off of work at 3 so I had roughly 4-5 hours to renovate each day and all day weekends. I'm embarrassed to say, but my 1 month estimate turned into about 4 months. It started off fun, but quickly turned to dread. Sometimes I wouldn't go there for days or weeks because I was too tired or sick of fixing things. I could've saved money if I had hired someone because I lost rent for all those months.

My advice is to hire someone to do the work. Guaranteed it will take you 5 times as long to fix things than them. Get multiple bids and complete each room separately. Time is money and without you having any experience I would not even tackle that.

Joo Park · Answer

is it cheaper to hire a GC who get better sub contract prices or you  being GC and getting retail sub contracting price?  If the latter, then, hiring GC is the way to go.

Paul Timmins · Answer

@Matthew Smith

We pay for our learnings one way or another.

Get a GC and learn through the process.

To systematize property management get a ARM certified property manager from IREM.org follow how they do it then adopt the system as yours.

Good luck

Paul

Shaun Mirza · Answer

Get General contractor. Its better to have someone with experience on this to answer question on the job site. You driving there and having work held up due to no direction to the subs will cost monet in the long run

Dell Schlabach · Answer

Depends on comfort level, your interest in learning the costs and process of running a rehab. If this is the only one you will be doing or planning on only a few, I would tend to recommend hiring a GC.

If you want to learn to be your own GC, there is never a time like now. Get J.Scotts book on rehab costs, time lines, and order of doing projects.

The order is cruial on some of the key components. If you do the items in the proper order, and you get fed up with being a GC you can always farm out the rest to a GC. If you dont get the order correct as @Jessica S. and I have learned the hard way, it can be a pricey and unpleasant learning experience.

Much success to you!

Josh Rang · Answer

If you don't have experience in construction I would get a GC. There are a lot of issues that could come up where experience can make all the difference. Also, if you can't be there all the time and don't know your subs whose to say if they are screwing around, doing things correctly, etc....

Shanequa J. · Answer

Hire the subs yourself because sometimes I feel like GCs jack up the price and take the difference.

Renovation - get a contractor or be my own?

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