If you are a fix and flip real estate investor a reliable contractor is essential. Not only will they improve your bottom line on every project but they can create a great working environment. Unfortunately good contractors don’t just fall on your lap. It is not uncommon to go through several contractors on your way of finding the right fit. Like anyone else you work with you should spend some time screening your contractors until you find someone you are comfortable with. This period of trial and error can be frustrating at times but when you find the right contractor it will be worth it. Here are five tips to help you find the best contractor for you and your business.
- Ask Your Network. The first place you should start your contractor search is in your local network. Reach out to a handful of people you trust and ask them if they know anybody. Even if they haven’t personally used a contractor they most likely know someone that did. A network referral doesn’t guarantee a good fit but it is a good start. Think about some of the most important people you have worked with in your business along the way. A common theme is that you liked and trusted all of them. By reaching out to the people in your network there is an immediate sense of trust right from the start. This doesn’t mean that they will always work out but they have a much greater chance then finding someone you know nothing about.
- Referrals And References. A referral from someone in your network is nothing more than an introduction. Even if the referral came from a close friend you still need to do your own vetting. If things don’t work out you want nobody to blame but yourself. After you make your initial contact you need to go a step further and ask for any references and referrals. Your friend may have had a great experience but you need to see if that was the exception rather than the norm. Try to talk to at least three other people who have worked with your contractor in the past twelve months. Ask them about their experience and if they have worked together again since the last job. If the answer is no try to find out the reason why. Your contractor is too important to go on gut alone and not do your homework. The more people you talk to the greater the chance that you will work with the right contractor for you.
- Previous Jobs. Contractors are a lot like real estate agents in the sense that they can excel at one specific area of what they do. A real estate agent can be a great selling agent but may lack experience with new buyers. A good contractor may be great working with kitchens but may not be great on woodworking. The only way to find this out is by asking your contractor about any previous jobs they have done. Most contractors keep pretty good records of their work. It is not uncommon to be given before and after pictures of rehab projects they are proud of. Not only will pictures give you a good indication of quality but it will give you a sense of their style. Don’t be afraid to ask your contractor what their strengths and weaknesses are. You know they are a good fit if they are honest in their personal evaluation and can give you a few flaws they may have.
- Payment/Work Schedule. If you believe that you have a good contractor you need to take one last step before committing on a project. It is essential that you discuss how they work and payment expectations before you get too far. There are some contractors that demand they have the house to themselves as they do their work. Even if this has some merit it may not always be reasonable. They should be willing to be flexible and understand the big picture of the project. It is also important that you iron out financial details. A contractor has every right to ask for material expenses to be covered before they start working. However if they ask for a portion of their fee upfront this may be a sign of a red flag. Don’t be afraid to ask why they are requesting this money before any work is started. If there are issues before a job begins you can bet they will continue throughout the project.
- Ask Their Opinion. If you have a project that is ready to go ask your contractor for their opinion on what they would do with it. This may catch some contractors off guard but the ones that answer are the ones you want to work with. Any contractor can do what is asked of them and complete the work. You want a contractor that has their own opinions and isn’t afraid to offer up suggestions. Having an extra set of eyes and ears that you can rely on can help you make smart, efficient decisions. Give your contractor a budget and ask them what they would do. If you like the answers you know you have a keeper.
It is not a stretch to say that finding the right contractor can completely change your business. Spend whatever time it takes to make sure you have the best fit for you.
