All Forum Posts by: Account Closed

Well said Alex

If I'm reading this correctly, what you're asking is that the PM turn over his playbook to you, for free. Why not just walk into some local restaurant and ask for the recipe for their special dish? That's essentially what you're doing.

PMs spend years cultivating relationships with contractors. This benefits you because it means the PM gets lower prices and priority service when there is something that needs to be addressed. And you just expect him to turn over the fruits of these years of work to you, for free? For all he knows you're planning to use his information to start your own property management business. Or, more likely, use his information to self-manage and cut him out.

I'm not saying that my contractor list rises to the level of a "trade secret." If you were my client, you'll see their invoices when I bill you for the work. And I would be happy to have you use any of my contractors for any your flipping projects. But to do an end run around me where my contractors are concerned; well, that's just not cool.

"Friendly and trusted" runs both ways. I would consider you neither if you demanded that I "give away" my contractor list as a prerequisite to doing business with me. It's not a good way to start a relationship and I would politely suggest that you take care that the door doesn't hit you in the *** on the way out.

@Account Closed, If you're using the PM company to only gain access to their contractors and not using the PM company, common sense tells me this may be bad business. If the PM company is using public contractors, then maybe they would share that information but you probably wouldn't get as good of a deal as you would with the PM company involved.

Why don't you just call a bunch of contractors and get bids, ask as many questions as you desire. Most contractors I would think are willing to give advice and talk your ear off.

This is my thinking:

I would like to find a PM company that would use their contractors to get my property "renter ready" in a timely manner, have renters immediately move in, then manage it for me. 

This to me, would be a win-win situation.

@Alex Craig, is this the type of win-win situation you are talking about? Do most PM companies offer this type of service?

Good luck!

Hello Dante,

If the property owner share's the contractor's information, it isn't very likely that the contractor will give you the same pricing that he gives a property manager.  

As soon as a PM and contractor find that they work well with each other, the contractor can focus on doing what he/she, (usually), does best, getting work done, instead of selling the next job or paying for SEO or Pay Per Click Ads.  Those marketing resources, (in funds and time), make up the volume discounts that the property manager realizes as they pass more work along to the contractor than the vast majority of private citizens, or even a small or medium sized flipper or landlord.

Obviously, a large flipper/investor on BP can generate as much or more work than a small or medium sized property management company, which would also translate into more aggressive pricing for them as well.  

There are differences, however; a contractor working with a PM is likely only going to see a few, full blown remodels a year, whereas a flipper is going to live and breath that kind of work.  The flipper contractor has a better grip on his scheduling, (DIY Network shows notwithstanding), and the homes are usually vacant, where a PM contractor is usually responding to breakfix repair or preventative maintenance and must be able to work around a tenant's work schedule and household belongings.

You should become a HUGE flipper, and then you can get great pricing, or own your own construction company, (which is where a bunch of our BP colleagues are going).

 Yes. But we charge the owner.

Small firm should be less expensive and provide the same quality.  I would find an architect that focuses on residential.

 Yes. But we charge the owner.

Not a home inspection. My property management company does an annual inspection to make sure the tenant is taking care of the property. We charge the owner a fee for that service. The maintenance and repair services income is the difference between what the property management company charges the owner and what they pay their contractors.

 I run a full spectrum real estate business; I hold, wholesale and retail. Just depends on the deal. I play in the entry level market and it is all pretty much straight off the shelf from Home Depot. First time home buyers are easy to please because they don't really know what they want. They just want to stop paying rent or living with mom. Therefore, an architect is never called for unless you plan on doing some additional square footage which is not part of my business model. 

I'm a turn and burn kind of investor. I don't like being bogged down on a rehab for months and I detest working with government entities like code enforcement and the building department. Surprisingly, most of my best deals are clean and fix, then sell fast below market, especially in this hot market. I am doing a rehab now that is costing me $6K. New counter tops, some paint, fix a window, replace the tilt up garage door with a roll up, and some other minor tune ups. 

When inventory is low, there is zero reason to do a full blown rehab. I think most investors do it because they don't know any better and/or they just want to impress their friends with the pictures they post on Facebook. Why spend $25K to sell for $200K when you can spend $5K and sell for $185K? Less in, more out and a faster sale because it is "sweat equity" deal. First time home buyers will fall for that gimmick again and again in a hot market. 

As for the design, I don't really get involved too much. Most houses I don't look at before I buy and probably only see once before I list to sell them. It is the contractor's job to walk it and write up a rehab proposal. Why do I need to be there? I don't know how to swing a hammer. I know how to write checks so I stick with what I know. He does the work and sends me pictures. 

Real estate can be a completely hands off business, but most are too scared to actually take that next step. They think they need to micromanage every aspect of the buying, fixing and selling. Sit home, buy houses cheap, send your contractor out to fix them and have your listing agent do the walk-thrus to tell you what needs to be touched up. If you hire a listing agent, make him/her work for the money. He/she should be perfectly capable of doing a punch list and even picking out colors/textures that will get the house sold. If not, get yourself a new agent.