All Forum Posts by: J.R. Gutierrez

Hello BP Community.

My partner, @Charlie Cummings, and I are looking to create a partnership with an investor who can come in with funds, either cash or the ability to secure financing, to work with us in acquiring fix and flip properties.

For the past 8 years I have been running large residential construction firms in Orange County, CA and have a lot of knowledge and ability when it comes to managing remodels. I can manage rehab projects to get them fixed quickly and in budget so that we can have them back on the market as either flips or rentals.

Charlie is a Broker Associate with Keller Williams and is great at searching for properties and running neighborhood analytics to get accurate comps to analyze the numbers correctly.

I'm looking to establish a 80/20 split, with the financial investor receiving 80%. While Charlie collects his share from the agent commissions. 

We've met with several "investors" and have walked several properties with great potential. In the end, the investors end up getting cold feet and backing out.

If you have questions or would like to see some of the property reports we've presented previous investors; please send me a direct message.

Thank you.

Welcome @Barry Rupisan! I'm a fellow newbie as well. Maybe we can grab a cup of coffee sometime and talk real estate!

Hey @Zac Newell welcome to BP! 

Hey @Jason Nye

It depends on what is causing the leak. Some leaks will be easy to fix but others may be more serious and costly.

Here's a quick little article about leaks in basements that may be useful

Wet Basement Solutions

Hey @Laureen Youngblood, I can see your point.

The material question is not meant to waste the contractor's time or pull a fast one on them. It's to avoid using a contractor that is bidding their labor low to get the project but making it up on the material cost. Yes, they do get contractor pricing but not all contractors pass that saving on to the customer. If the contractor is itemizing his bid, he'll already be taking measurements to provide you price. 

Example: The GC charges $2/sqft for 1,200 sqft of flooring for a total of $2,400.00. As the homeowner, I now know that I need at least 1,200 sqft of flooring material. I can now get that myself without him going to the store with me. I haven't wasted his time nor made his job any more difficult.

This point is really for finish materials (tile, flooring, cabinets, etc). I wouldn't necessarily recommend doing this for the drywall, framing material, insulation, etc unless you have the knowledge of these items.

I've done plenty of jobs where we only did the labor and those jobs tend to run smoother because we don't start until they already have their material paid for.

At the end of the day it depends on how much work the homeowner wants to do and the relationship they have with the contractor.

Thank you @Sydney Hall and @Leanne Rivard for the welcomes and information.

Thanks for sharing your story @John Claborn

Hopefully your brother-in-law cuts you in on future projects. Congrats!

Hey @Brian Garrett

I'm glad you're already thinking of the basic (and important) questions for your contractor interviews. I would present them with a basic scenario and ask some questions to try and get a good idea of how well they will perform. For example: I would tell them that the plan is to renovate the kitchen with new cabinets, appliances, countertop and backsplash. And update all the flooring throughout the house. Then I would ask questions like:

1. How many workers will be on site at a time?
2. How long would you estimate the project to run for?
3. Will you perform all the work in-house or sub it out?
4. Is your estimate itemized or lump summed? 
5. Can I purchase all the material and pay your labor only?

Questions 1 and 2 will help you determine if the contractor is staffed well enough to handle the project they are bidding. If he says it'll take 8 weeks with 3 guys on site; that, in my experience, is too long. Same if he say 3 weeks with 3 guys; probably full of it or cutting corners. Question 3 is for your protection. If he uses sub contractors and decides not to pay them; you may be hearing from them and possibly receive liens against the property. If they answer yes to this question: let them know you won't release payment without lien releases from the subs. Question 4 is meant so you can understand what your paying for. Any legit GC will always itemize their estimates. If they say "Home remodel - $25,000", trash it! Chances are you'll get into discussion about what is and isn't part of that $25,000. And questions 5 is an attempt to save some money. Most GCs will put a percentage on top of the cost of materials to "pay" for their time to go out and buy it. Save that percentage yourself and buy the material. Offer to meet them at the hardware store so they can hand pick what they need if you're not familiar with materials. 

Like @Natalie Vane said; you shouldn't have a problem getting contractors to walk the jobs with you, but even then these questions will help you pick a qualified GC.

Hope this helps!

@Charlie Cummings welcome! It was great meeting up with you and talking real estate. Look forward to working with you.

@Ben Valentin any legitimate contractor will give you a free estimate for the work. But like you mentioned, time is of the essence when it comes to these deals and the contractor may not be able to meet you right away, so that's the tricky part. You can go to homewyse.com and use their cost estimators to get an idea of the cost, but I would add about 10-25% on top of their estimates just to be safe. If you start to do several projects a year and use the same contractors regularly, you can build a relationship where you can call them to meet you at a property ASAP so you can put in an offer knowing what the cost will be. Always allow yourself a little bit of "extra" expenses because once you open up walls, you may find something that no one knew was there - specially in older homes.