Advice on finding contractors for rehabs

[Brad Scott]

What advice would you offer for hiring contractors to help rehab my first distressed property? I’ve never done one before and am not sure where to start.

Thanks for any advice.

[Joshua McMillion]

@Brad Scott

Great question! I would start with reading the BRRRR book by David Greene. He essentially lays out the process of hiring a solid general contractor. When you interview the contractor, ask questions that centers around cost, schedule, and performance. Also, make sure that you shop around when it comes to pricing data to get quotes. That way, you can determine what rate is fair market value for labor. Material prices are a small price of the overall construction price, so I would recommend finding a contractor with systems in place to reinforce schedules. For example, maybe they use something like Monday.com to manage their jobs and personnel. Usually, most general contractors use subcontractors to complete specific assignments. For instance, my GC used granite and flooring companies on my last deal. If they do not have systems to map out all the moving parts, you will have schedule slippage. I would also ask if they make incentive-based contracts. You would create a contract for the GC that gives them a small fee if the job is completed to standard and on time. However, if they bust schedule, the cost is lost and each day over schedule results in a small deduction to the agreed-to price.

Hope that helped!

Sincerely, 

Josh