If you want to Fix/Flip houses here is the 1st 5 of the 10 items on the list.
- Line Up the Subcontractors – After you have the house ready to close, and financing all lined up-now you are ready to rehab! It’s best to have all your sub-contractors or your main contractor meet at the house before you buy the house. You should know the budget and any extra costs that may be upcoming for the rehab. Get all proposals and costs in writing. Also, get a signed contract from your contractor(s) before any work begins. (If you don’t have a contract there are plenty of templates on the internet). This will also help you to know what materials need to be purchased if you are responsible for the supplies. Having a contractor that covers all the costs is easier, and less daunting-especially if you are a new investor. However, be ready to hit the ground running!
- House Demolition – If there is moderate to heavy demolition have a dumpster on site the day of closing. Remember time is money! Make sure you have the contractor or crew scheduled to get to work the day of or the day after closing. The demo (demolition) is the first step to getting your project off to a good start. Once completed, you will be able to evaluate additional costs, and come up with a solid game plan for the reconstruction, and final layout of the house.
- Walk the Layout – Have a diagram of the room layout and design of the house. This can be a drawing that is done by a CAD based program (you can find them on the internet). A hand drawn diagram is fine also. Walk the house with your contractor or sub-contractors pointing out all the changes and designs on the diagram. This is a good time for the contractor to point out any additional costs or materials that may be needed. Make sure to get any additional labor costs (typically called change orders) in writing from the contractors. After walking the layout, post the diagram in a prominent place in the house for future reference. Time to order the materials.
- Order the Materials – The list for ordering the materials should be made when you walk the layout. That way the contractor can help you make sure you order all the materials that are necessary. When ordering materials try to use the same vendor on a regular basis. (Home Depot & Lowe’s are great resources). You can usually get extra deals and discounts for volume business. Being a loyal customer also is invaluable when problems arise. If you have your contractor order for you, this will save you time and effort. WORD OF CAUTION!!! If you allow your contractor to order for you, get copies of invoices to keep them honest. I recommend that you pay the invoices, so that you know the bills are paid. This avoids the possibility of a lien on your house if things go south, and the bills don’t get paid.
- Keep the Schedule – Weather you are running the job or your contractor, keep a schedule of all important dates. Every sub-contractor should have a beginning and an end date. This will keep everyone on target. Do not let the contractor set arbitrary start, and completion dates. You mange the schedule! It is your time and money. There will always be delays. Having a schedule will keep things from getting out of hand, and will get your project completed in a timely manner. Most subs and contractors have multiple projects going at the same time. You must be a squeaky wheel to get things done on time!!!
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