Are any serious investors self-performing their rehab's?

Question

I've spent the last two years remodeling our 1912 craftsman bungalow home. This process has done two things. One, help me discover I love carpentry. Absolutely love it. I grew up a farm kid and have spent the last 10 years in an office doing sales/marketing. I enjoy and miss hard work and the process of working with my hands.  And two, it started my curiosity for real estate investing and sent me digesting everything I could about the real estate game for the last 18 months. As we all know, BP is fricken awesome and authentic in their education.

In two weeks I close on my first real estate property (picture below). It will be a buy and hold that needs a lot of work. I estimate $7-10k of rehab.  (I have been using J.scott's estimating rehab costs book).  Everything I read says that it is best find a good GC and hire out all the construction. Being a businessman I understand this logic. Delegate out what you are not good at (or can be easily hired out) and work on scaling your business.

But is anyone on BP self-performing their rehab's? As in having a tool in hand doing 50+% of the work themselves and hiring out a few trades (plumbing, HVAC, carpet, painting, basic demo help).

I should also note I do not like my job and plan to leave in the next year. I have debated starting a remodeling company or just self-performing my own flips for cash flow.

Would love to hear your feedback BP!

PD

Preston Dahl · Answer

Thanks for all the responses everyone. I think I will be doing a portion of it myself and a portion of it will be hired out. I close next week so wish me luck!

Mindy Jensen · Answer

@Preston Dahl , I'd love to be able to hire everything out, but it boils down to finding good contractors. I'm a PRO at finding bad ones. You want someone unreliable who will drop the ball at every turn? I excel at finding those guys.

I have yet to figure out how to find reliable guys who show up every day and do a good job. So I turn to my husband and me, and we get it done on time, on budget and right the first time. Fast? No. But right, which is worth more to me.

Emmit Giddings · Answer

Being a former General contractor and now Flip properties, I started doing the work my self. I have found in the last 3 years that budgeting for contractors on projects is better for me, It allows time for marketing for finding more properties. I do think that any one who is flipping properties should get there hands dirty, and understand what goes on in all aspects of a flip. I will give you a better understanding of what needs to be done and the time it takes to do it.

James Fisher · Answer

I tend to do the vast majority of the work.

The one caveat is that I refuse to work off ladders (>6ft) or on roofs.  The risk of falling is not worth saving a few thousand $.

That said, renovations take me a loooong time.  I'm fine with that.  There are not hundreds...or even tens of deals within my maximum distance (15 mins).  As long as I have one in process and one on the line, I'm happy.

Jerry W. · Answer

I used to work with a partner who was a contractor and he did most of the work and I would help demo.  When he retired I began doing work myself.  I cannot find reliable contractors for a reasonable price.  I often do a lot of the work myself.  I am so so on drywall, but am a good painter and can frame, install most plumbing, I do several roofs a year, and can do most electrical work.  I also install doors and windows.  All that being said I can do most of these jobs as good as most contractors I have hired and often better, but I am much slower and the projects take a lot of time.  If you really want to scale you need to hire things out and have a team.  My local economy is pretty tight and so I save money by doing things myself.  I usually enjoy working with my hands as a good alternative to the day job.  I usually hire unskilled labor to help do tear outs and landscaping etc. and I just tell them what to do.

Still I know in the long run my company would go farther and get bigger faster if I hired things out.

Tanya F. · Answer

Yep. We do a lot ourselves. And we have good contractors and subcontractors for the things we don't want to do.  In each situation, we calculate how much it would cost to hire out versus do it ourselves (counting any cost of  extra time it might take for us to do it- usually not much, we are pretty fast). Plus we decide case by case what we feel like doing.

What we do ourselves (in general) - We paint both interior and exterior, hang and tape drywall (but on the last big drywall job we hired a couple of guys to hang the ceiling pieces), we fabricate and install trim, hang interior doors, install some flooring. Stain decks. Finish electrical and plumbing. Install kitchen cabinets and vanities. We do finish work, we are also particular.

We hire out rough electrical and rough plumbing, roofers and framing (if we're adding on), insulation, replacing/hanging exterior doors, replacing windows (though we stain and finish any windows/doors before our contractor installs them)

We do this all on weekends or days we take off from work.

Johann Jells · Answer

I do a lot of my own work, partly because I'm particular. But big stuff I have to hire a contractor for. The problem with having a contractor do the rough work, like gutting out and sheetrocking for me to do all the trim, is that you don't find all the easter eggs they've left you till they're gone. It's REALLY HARD to catch all the screwups in a walkthrough. I just assume this last contractor, that I'd used before, wouldn't screw me because he'd want to work for me again. I guess I was wrong. Some stupid stuff I noticed like he used stair nosing for window stool. But I let that go, because I foolishly didn't want him to not want to work for me. It's hard to find good contractors here. Other stuff like out of square walls and doorjams with the sheetrock proud of them you don't notice till you're working there.

I failed to oversee properly.

Max T. · Answer

Do the aspects that you love and can do cheaply.

It sounds like you enjoy the carpentry.

For me - I like tile work.

Are any serious investors self-performing their rehab's?

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