All Forum Posts by: Bill J Fay

Nathan provided great insight. I would just like to add that you should see what your lease says. Usually there is verbiage that you both agreed to in the lease that should guide you here.

Go to local RE Investor meet ups. Ask which Real Estate Agents investors use (or if any are RE Agents themselves). They will be very connected in your local market. You can also call RE Agents from listings when a property looks renovated; there's a strong chance they are representing an investor(s). Let them know you are interested in investing yourself. These Agents will be a great source for knowledge, expertise, and connection to help build your team. You've made a great choice in the BP community too. Check out the "Build your team" tab to help find Agents, Lenders, and contractors that will help you achieve your RE goals. 

You certainly can include an inspection contingency but like any transaction, the sellers will want to accept the best offer. For an ‘As Is’ deal, especially in a competitive market, you’ll have other investors that will bring in an offer with no inspection or appraisal contingencies with a quick close. Lean on your agent to asses what offer will get accepted. 

Networking with other investors, agents, and wholesalers will allow you to scale your business. Sounds like you have your team in place, but you can never have too many quality contractors in your book of business. Make sure your Agents are sending you deals. Establish a connection with your lender so you’re ready to hit it hard when you find your next flip. Good luck!

Does the Property Manager have construction experience? Some of the best Property Managers aren’t as knowledgeable when it comes to making costly renovation decisions. I would only have them manage the Reno if they had many completed projects under their belt. I would stick to GCs and Project Managers that focus on this day in and day out. 

Like others have said, it really comes down to the numbers. But, understanding the numbers is also very important. Is your market in a declining, stable, or healthy market? How do the comps look? Is the comp that is selling fast fixed up with high end finishes? Or selling with rental grade? It’s important to learn your specific market and tune your product to your largest potential buyer pool. 

Call the inspector to see if they have any quality contractors that could perform the repairs outlined in the report. More often than not, they have a vast book of contractors.  

As long as you have a detailed scope of work along with a contract, yes your contractor should be sending you a detailed invoice for any change orders. I doubt they would charge you for the tiny work you described, but setting your contractor back in time could create some issues in the future. Communication is key in construction. 

I highly recommend walking your jobs with a licensed General Contractor if you are just getting into flipping houses. Assuming you are new to construction, a GC will approach your project with a different eye. While a GC will cost more than subbing each trade out on your own, there are numerous benefits you will receive. They will pull your permits, coordinate skilled subs that they have history with, as well as keep your project on time. I never pay contractors to do initial walks, but that may be location dependent. If they want you to pay up front, tell them you are a real estate investor and you are looking to build a relationship for numerous projects, not an end user looking to do one deal. 

Sorry that you had to go through this. I hope this experience doesn't turn you away from HML's. They can be a very useful tool to your business. BP has vetted and recommends numerous HML on their suggested page.

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