How do I Become a Contractor?

8 Replies

Hi!

I am a complete rookie when it comes to real estate. My plan is to become a contractor and rehab properties with my partner in Houston. However, there is no guide to becoming a contractor. Should I go to school for contracting? Or should I study on my own and take the state licensing test? 

So my plan is to attend San Jacinto College for a Bachelor's in Construction Management, then take the state licensing to become a contractor once I graduate. I don't want to fail at this so I feel that school is must. I also plan on going to on-site jobs while in school and creating relationships with vendors. 

I guess I need advice from people who have walked in my shoes. Is school necessary? Or can I succeed and save time by learning this trade myself? 

Thanks for your time and consideration!

Emmy

Hey @Emmeriah McDowell , welcome aboard. Not sure how the contractor licensing laws work in your state but I know here in Cali you have to be able to demonstrate 2-4 years (depending on how much relevant education) of on-the-job experience before you can get your license. I was going to get mine but ran into some challenges around demonstrating experience as much of my experience was in building my own house and it was difficult to verify. Anyhow, sounds like you and your partner are setting goals, getting focused, and heading in the right direction. If you are currently paying rent then I'd look at getting into a duplex or hacking your living situation (as Josh and Brandon always recommend) so that you can live for free to save for that down payment. Also, make sure you know about FHA loans. We bought our place for 3.5% down.

Cheers,

-Orion

@Emmeriah McDowell  - In most locations, you don't have to have a license to rehab your own properties - or those of a partner.  I once looked into becoming a contractor so that I could build spec-houses.  The expenses (liability insurance) were quite high.

@Emmeriah McDowell  I am a contractor and I have been doing construction for about 16 years. Ill tell ya what, the thing that helps me out the most is being in the trade for what seems like eternity. You have to know what comes next, you have to know codes, you have to know people, you have to know suppliers ( I know some people just go to home depot and buy their stuff) but as you grow you realize that that is not the place to be! J Scott will get all over me about that one :)

If you are willing to take a management class that is a good start but in my humble opinion you may want to hire a project manager, foreman, or a superintendent to help you on your journey.

I have taken loads of classes, courses, certifications, blah blah blah but I feel experience is the real teacher. Bummer it takes so much time.

In my state I don't even think they require schooling or years of experience..... I could be wrong since its been  awhile since I filled out the paper work. But like I said, I may save you a few head aches by making friends with a couple and hiring them to help you out.

Best of luck whatever you choose.... and keep us updated on how it goes!

Thank you all so much for your advice! Very helpful and insightful!

Emmy

The big question is what type of contractor do you want to be? There are 2 types, a paper contractor and a working contractor. Let me explain the difference.

1. Paper contractor - Has degrees in business management,  project management, finance management ect. . He is the one that will hire all subs and even an on site supervisor who knows the trades. He has learned knowledge of how to run a business.

2. Working contractor (As Cole said) - Has worked in the trades for years swinging a hammer and putting in the hard work and sweat learning his trade as a carpenter, plumber, mason ect. He has working knowledge of what it takes to repair a house.

I am not saying one is good or bad over the other, just that you cant decide to become either one overnight. Good luck.

@Emmeriah McDowell  Each state has their own qualifications for licensing, so you will need to check with yours. A formal education isn't required, though having a good foundation and understanding in finance, business law (contracts), building standards, etc. is good. 

As was mentioned above, the best route for you depends on what it is you want to do. There needs to be someone on the job that knows how to build; and can oversee the jobs. It takes time to learn everything that is involved, depending on if you are doing simple rehabs or new construction, etc. The best way to learn is by working in the trade. Getting a license isn't the issue, it's knowing the trade. 

You can always hire a General Contractor, it's not necessary to do it yourself. The question is, what is your end goal, do you want to work as a contractor and do contract jobs, just your jobs, rehabs, development, etc.? Once you know that, you can decide what the best use of your time is. Is it going to school, or getting on construction jobs to learn the trades? Or possibly a combination of the two? 

I am a licensed general contractor in California. I had to show experience in the trade and take the test. I do not however; work on the jobs. I do go out to the jobs and check them out at various stages. Our projects are all owner/builder, so it's not necessary for us to be licensed, howevver; many lenders require a licensed contractor. 

Buy a Delorean and convert it into a time machine. Then travel back in time as a young child and hopefully your father can teach you.

The reality of it is my belief is you either have a knack for this type of thing or you do not. You cannot teach everyone everything. My dad had me wiring homes and plumbing them as a kid. No school can teach you that. You yourself stated you are a rookie when it comes to real estate. Well maybe hone in on that. Any Tom or Jane can be a realator but repairing homes is another deal that involves some skill and know how.

In this day and age there is a million ways to make money. Choose one you know something about as you will be far ahead of the game. If your passion is this well keep at the school and like others mention and get on site. You see a school only can give you so much. The very best contracters out there learned from the bottom up.  You are attemtping to learn from the top down. It will be tough.

Many successful contractors I've met started from the ground up either working for a company as an employee or being an apprentice for someone else in a specific area. As with any business, it's best to learn the ins and outs in order to run it effectively. 

Hope that helps! 

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