If they want it I suggest they pitch in effort or material....

Labor and material costs in the Bay Area are on average $200-$250 per SqFt for brand new construction, so that's where I'm at a loss - even for a rehab of 3k SqFt, it shouldn't be that cheap.

They love the idea of the package I'll be able to offer.

Keep in mind the premium can change depending on: actual replacement vs cash valueliability protection levelvandalism clause or notmedical expenses levelprotection of rent income or notwater backup or notrebuild code update or notdemolition removal or nottype of house (1 story vs 2-story), type of construction (e.g living space above garage) and materials (brick, stone vs. wood siding), or roofmultiline discountshistory with the provider, claims history and CLUE report/scorecredit score (maybe)property historydesired coverageetc.

I would add that I have used a reputable HML lender that does front some of the construction costs but of course, not all, 3 draws of 1/3 the construction costs were provided, the first draw within the first week of the loan(the subsequent draws required third-party inspection of course) and the draws specifically state they are for material, not any labor, so a first time HML investor needs to be prepared with additional liquid cash assets as you may have to float some of the construction contracts as you mentioned being that most contractors want up to half of the contract cost up front.

I have a potentional lead on a multi house package deal that cash flows well.

His bid was not broken down very well with materials.

I packaged it together as a business plan.

But I’m looking to refi my properties into packages.

Of course i always like the cheaper material.