I bought my first investment - Duplex on 4 acres (140k). Each unit 1100 sf 2BR/2BA with washer/dryer in each unit. We just sold our big house and will be moving into one unit and rent the other. We are a few years from retirement and plan to stay in the duplex approx 2 years while we learn to flip other properties and hopefully get into this full time. I want to be very careful to not over spend and not select things for my own taste and style. I want to save $ on this rehab. It will easily get full price rent in this area $850-$950/mos. It also has a very nice 2 car detached garage (one per unit). We may consider building more units on property later down the road.
My Realtor/friend referred me to her contractor she has used many times and saves her money on her flips and rental rehabs. This Contractor also flips for herself and I saw two of her single family homes that are newly on market. They were very nice. She showed me exactly where she cut costs. She is known to save investors money because she does not sub out the work. Her employees do most everything. She is very willing to work with me and teach me this business and about selecting cost saving products that look nice, etc.
I want to learn about all the costs involved and learn all I can since I want to eventually do this full time and I want to eventually know when I see a property what the APPROXIMATE COST WILL BE FOR LABOR & MATERIAL.
I told her my budget was $20-$25/unit. I asked her if she can give me a price on her labor to gut & rehab and I would pick out everything else that is needed with her suggestions, of course, on materials. Ie. Floors, appliances, cabinets, vanities, lighting, all fixtures, etc. She is giving me her contractor savings at Home Depot in addition to Labor Day Sales or if I can find things cheaper she will buy it anywhere I can find the best deal. I do NOT pay for materials upfront. I will put it on her account at the store. I have plenty of time during the next week to shop prices for Labor Day sales.
I am preparing for our meeting this Thursday. We are meeting at the duplex for the 2nd time to measure both units. Then she will give me her bid on labor which will include all general materials her team uses and will include travel for picking up all my materials I purchase from various local suppliers.
QUESTIONS:
1. Is this an ok arrangement?
2. What do I need to be careful of or be aware of? What do I need to pay close attention to?
3. How do I know she is not overcharging me on labor and I will have enough $ left in budget for all needed materials? I am a great shopper but do not want to be taken advantage of.
4. Is there somewhere I can see what average labor costs would be for rehabbing a small kitchen, bath etc. in my area near St Louis, Mo?
PER UNIT:
1100 s/f, 2BR (2 closets each bedroom with bi-folds), 2BA with tubs/showers in each. Hallway laundry with bi-folds,
Hallway water heater with bi-fold.
This is what I want my bid to include:
Gut entire units & remove.
Am I forgetting anything?
1. Remove ceiling popcorn every room
2. Apply texture to all walls & ceiling
3. Install 2 new hot water heaters
4. Only One unit - pour concrete patio 12x12.
5. Labor for tile floor in each bath.
6. Labor for entire shower (inexpensive) tile work in each bath & backsplash around bathroom sinks & kitchen backsplash.
7. Labor to install 4 Inexpensive closet organizers from home depot in bedroom (2 closets in each bedroom in each unit = 4 closets per unit.)
8. Labor for carpet both bedrooms.
9. Labor for install waterproof faux wood floor in kitchen/living/hall.
10. Hang new blinds
11. Paint all walls & ceiling (two colors) each unit. Closets one color. (White ceiling & neutral walls same color throughout.)
12. Install all new kitchen: cabs (very small amt cabs), appliances, (no dishwasher), above stove microwave, new garbage disposal, Fridge with ice maker hook up, electric stove, sink/faucet.
13. Install (4) 6 panel doors = 6 sets bi fold doors.
14. Install new lighting & 3 ceiling fans & porch light.
15. Install new door knobs all inside doors and two (front/back) doors.
16, Install new trim/baseboards & paint.
17. I think all windows are fine.
18. No new electrical or plumbing needed other than new garbage disposal.
19. Oh ya, clean & paint gutters & down spouts.
20. No outside work needed.
DID I FORGET ANYTHING I SHOUKD TELL HER INWANT INCLUDED IN FORMAL WRITTEN BID ???
Is there a way I can research to find out what this should cost in my area so I can make sure this contractor is not over charging me on labor???
Thanks so VERY much.
:)
