All Forum Posts by: Adam Gonzalez

It's not so much a red flag as how they do business. I prefer to purchase the materials separately and then contract with them to do the install. Generally the contractor will go to a supplier and/or big box store to get the supplies and then have the contractor desk call me for payment. The materials can then be delivered to the property or the contractor can take them to the job. This way I can control what is purchased (just what is needed for MY job) without a materials upcharge, avoid any supplier liens should a contractor not pay for the materials purchased on account, and have a full accounting at tax time for deductions.

If you want the convenience of just hiring a contractor to do the whole enchilada, don't expect a cost breakdown. The contractor is simply pricing the job. In this case, be clear that if extra materials are needed, how that will affect the cost of the job.

Hope this helps.

Patricia:

Thank you for your advice! I have some thinking to do. Hope you have an enjoyable weekend :).

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Quote from @Nicole Heasley Beitenman:

I don't know if this is common practice in your market; it isn't in mine. I understand their reasoning, though. I'm sure plenty of people get super cheap materials that don't hold up and then blame the contractor for it. However, we use rehab expenses to get free gas from Giant Eagle (haven't paid for gas in, like, 2 years), so I would insist on buying my own materials. I'm happy to go with their recommendations if they're reasonable, but I'm going to insist on paying for them myself.

I DO think it's a red flag that they won't separate the cost of labor from materials. There's never a good reason for lacking transparency. And you'll need that information to make informed decisions on future projects.

Nicole:

Thank you for your reply! I will definitely look into Giant Eagle. I have never heard of them before. Thanks for your feedback. I hope you have a nice weekend!

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Quote from @John Clark:

Your concern is the bottom line. Why do you care what the breakdown is? You're hiring the contractor to remodel, not to be a labor company. Transparency? Rubbish. You set a price, a design, and quality levels. How the contractor gets there is not your concern.

Then there's the point, as others have said, of you buying cheap materials and then blaming the contractor. Why should he open himself up to the grief and expense?

Now put the shoe on your foot. Let's say you rent out, with the tenant paying for utilities you supply as part of his rent. The tenant comes in and wants to change cable companies (violating your agreement with one company to supply all of the apartments), or electric service, and demands to know what your costs are. Your response is. . . . ? Help us out here.

John:

Thank you for your response. My concern is that this is my first time and I simply want to make sure I am aware of the costs so I understand them fully. You assume that I would be buying cheap materials. That is not the case. What if the vendor they choose is known for poor quality or grossly overpriced, or just only offers options that I do not like. In that case, it would be nice to have an option to purchase from let's say Lowe's a product that may cost less but is the same materials or is known for better quality. Again, looking for an outside perspective and wondering if this is a red flag. Appreciate the feedback.

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Happy Friday Everyone!

So I have a quick question. I am in the process of renovating a property and interviewing contractors. One contractor I spoke with provided a quote of $16,000 to renovate two bathrooms (1 small and 1 medium sized). This quote is for labor and materials. I was asking for the cost of labor and they indicated they do not separate the two. They also indicated that they only use their vendors for materials. This is not such a big deal but I would at least like the option to use Lowe's for example if I am not in love with the company they use or is too expensive and want to go another option. I just want a breakdown of what I am paying in labor and see what they are charging for materials. They were firm that they do not show the cost for labor and that they only use their vendors. Is this a red flag or common? Look for an outside perspective. Thanks guys and hope you are all kicking a$$.

- Adam

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Quote from @JD Martin:

Quote from @Adam Gonzalez:

Morning Everyone:

I have been discussing with some very close family friends the idea of purchasing land together, subdividing the land, and then each building our own homes. Does anyone have experience doing something like this? I was not sure how financing would work in this situation. Any information and advice would be greatly appreciated. These are people I trust and know extremely well. Obviously nothing is guaranteed in life so what can be put in place to protect all parties involved so everything is fair.

Thank you so much and I look forward to hearing from you all!

- Adam G.

Building your own homes for what purpose - resale? To live in yourselves? Create your own commune?

If this is something you're talking about doing for profit, I wouldn't. Better idea is create an LLC which you are all part of, buy the land cooperatively and develop it cooperatively. If this is something where you'll all live in the same neighborhood, it could work as everyone could build what they wanted on their own timeline.

The primary purpose would be to build our own homes to reside in.

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Morning Everyone:

Thank you so much and I look forward to hearing from you all!

- Adam G.

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Quote from @Paul Sandhu:

I knew a guy that was in a similar situation. He bought the house with a credit card to use as an STR. A guy that had an STR across the street put him out of business.

Paul:

I am unsure how that ties into my question? Can you elaborate possibly? Thanks so much.

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Hey everyone:

So I put an offer down on a home which was accepted. This will be funded via a 2nd home loan. I do not currently own my primary residence. The lender is requiring a quote for home owner's insurance for the "2nd home" which must have a replacement cost insurance policy. When speaking to my primary insurance carrier, they indicated they cannot cover me because I do not own my primary residence. I am unsure what to do in this situation. When speaking with the lender, they indicated you can get a 2nd home loan without owning a primary residence. If that is the case, then how do people get insured in this situation? Any help would be useful. Thank you!

- Adam G.

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Hey Everyone!

Just as the title states, how was the STR Bootcamp if you signed up for it in the past? Curious to see everyone's feedback. Thanks! =)

- Adam G.

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@Andrew Frowiss

Thanks for taking the time to respond. Yet another helpful person.

1 Vote

All Forum Posts by: Adam Gonzalez

Adam Gonzalez has started 18 posts and replied 46 times.

Post: Is this a Contractor Red Flag?

Post: Is this a Contractor Red Flag?

Post: Is this a Contractor Red Flag?

Post: Is this a Contractor Red Flag?

Post: Buying Land w/ Friends to then Subdivide and Build Homes?

Post: Buying Land w/ Friends to then Subdivide and Build Homes?

Post: 2nd Home Insurance - Stuck

Post: 2nd Home Insurance - Stuck

Post: How Was The STR Bootcamp If You Signed Up In The Past?

Post: Recession Coming? Is Now A Bad Time To Purchase A STR?