General Contractor Walk Through Fee

[Prashant P.]

I am looking to buy a house in a new area to fix up and flip.

Before making my bid on the house, I was trying to find a General Contractor to walk through the house with me and give me an estimate for repairs.

I also need a written estimate to submit to my private money lender so that he can look at the budget.

I contacted one General Contractor and he said he would charge a $500 fee for this, which is refundable if I get the work done with him.

The price seemed high to me, but I was looking to see what others have paid. It does seem comparable to an inspection.

[Aaron McGinnis]

I think $500 is excessive. Usually, I charge between $50 and 200 for a walk through depending on where the house is, how big it is, condition, how much of a rush there is, if the investor is experienced, if they have it under contract or not... and on and on.

I will refund the fee if I do the work, of course. BUT... only for that house. So in other words, if I go look at 10 houses and do one of them don't expect the fee back for all 10.

I disagree with Bill Gulley - if you have a contractor that is starving enough and desperate enough to go out and look at a house for nothing, when the investor has no contract, no EM at stake, and zero barrier to walking away, you're probably dealing with someone who doesn't do the best work! ... or isn't used to the games that happen as part and parcel in this industry.

Smart contractors know that 9 times out of 10, the investor won't make the offer... and even if they do, there's a huge probability that they won't get the house. Then, the contractor is left with burned gas, burned time, opportunity costs, and zero reimbursement. Such a person isn't likely to stay in business for very long without cutting a lot of corners somewhere.

On the contrary, a contractor who is does great work at great prices and is good with investors isn't likely to be sitting around, twiddling their thumbs and asking themselves, "I've watched everything on Netflix, should I go to Hulu or start an Amazon prime account next?"

No, those contractors are working their ends off, busting out ridiculously long days without a moment to spare. They absolutely don't want to waste their time and gas on a 10% (or less) conversion opportunity.

Bottom line - hungry contractors are hungry for a reason.