All Forum Posts by: Tom Lane

I've been a contractor since the sixties. The general rule of thumb is "parts times two"...

if you need 20k in materials plan to spend another 20k for labor. There is a reason some guys ask more and some ask less, nine times out of ten, THEY know what they're worth.

You can 'adapt' a 3/8 line to the washer but the machine will fill slowly, causing it to run longer and waste money/energy. Can you tee off 'downstream' of the 3/8 connection to a bigger supply?

I 'plan' to double my number of flips AND hire twice as many helpers to get me there...

BUT, I also believe that IF you want to make GOD laugh, just tell Him YOUR plan.

My goal for 2015 is four flips and a second investor. I've lined up the investor and if we only do TWO houses we're batting 500 and heading for the Hall of Fame!

My New Years Wish for ALL my fellow BPers -" Do your best and caulk the rest!"

FUNDING

All great flips need funding!

OUR 'rule of thumb' is to spend 1/3 for purchase and 2/3 to bring it to market (i.e., 20k to buy, 40k to finish, = 60k total. This includes materials, labor, utilities, insurance) We add another 1/3 + closing costs and THAT number becomes our ask. OUR average ROI is about 25%.

ALL deals are unique, of course, but that is OUR target...

Rust oleum makes a great DIY product for countertops. I was skeptical at first but after using it I'm a 'believer'! The kit was about $225 and did 16 l.f. PLUS a good sized island.

http://www.rustoleum.com/product-catalog/consumer-brands/transformations/countertop-transformations

We do mostly SFR flips.

Our first concern is the roof and making sure it won't leak on our hard work. From there we always start 'farthest from the exits' and literally work our way out the door. We see no point in dragging tools, ladders and materials through a finished space and risking scuffs and dings. As we finish a room we seal it off with plastic sheeting and frog tape. Once the last room is finished and all the tools are back on the truck we'll go back and unwrap each room (again farthest rooms first) and lay self adhering carpet protection or rosin paper on the floors - it not only saves the new floors during showings it gives the potential buyers the feeling that you took pride in your work.

I remember my mom handing me a five gallon gas can, and a dollar, then reminding me to bring back her change AND her S&H Green Stamps...

Thats something that ONLY the partners can decide, and it, and seven million other concerns should be discussed, IN LENGTH, before checks are written. IF ya'll can't work out the "easy" stuff it could be the beginning of a really bumpy ride...

Every area has its rules and regs, but when we posed the same question to OUR accountant, he said, "Put your agreements in writing and have all parties sign it, in front of a notary. Whatever it says, that is the agreement, and it would hold up in court..."

When his 'bill' came, we owed him three chickens and a goat.

In all fairness - we live and run our business, seven and a half miles from ANY town. We hunt and fish and farm, most days, and occasionally we sneak into town to poach a property or two!

I do a lot of flips and we establish a resale price going in. Try to visit as many for sale props in the neighborhood as possible, to see what your competition is offering...IF engineered hardwood fits in the budget, it goes in the house. IF every house in the area features standard eight inch laminate, we install a nicer looking 4 inch. The idea being to offer a little better product for the same money. 

In our latest project, the cost difference between hardwood and laminate allowed for a new 4 piece kitchen appliance set...we got our ask, and the buyers loved both, the floors and the kitchen!

Lee, 

Welcome to BP!