Investor · Clatskanie, OR · Member since 2014 · 212 posts · 233 votes
7y
Our first 10 properties my wife and I did ourselves. We at least doubled up on each one. I believe this was the biggest part of our growth. here is a big hint. We now hire most of the work out. I fired 10 guys for every one I kept. so far all of the investors that I know who hire contractors, give up huge chunks of profit and they are way behind us. I mean ALL of them!
Now with that being said, if you can somehow make profits while paying contractor prices then go for it because anything is better than a W-2 job right?
But, if you are looking to come up FAST, you better learn fast on how to remodel homes. This also eliminates a lot of risk by increasing your margin (ie Cash flow).
Also, I can spot a scam in less than a minute in most cases, just by what they say. You just know. I can't even explain it.
Have you been quoted 10K for a new roof. Same roof cost me less than 3K and I hire it out. Learn how to do the work and you will learn how to hire workers and what to look for later on in the game.
I have heard many say your time can be spent more wisely. I say, buy some knee pads and get them dirty.
Your best education is not buying a pack of CD's from some famous person that sounds cool, it is buying a trashed house and making it look great. You will learn everything you need to know from doing that. All the numbers will become crystal clear.
Rental Property Investor · Savage, MN · Member since 2016 · 202 posts · 61 votes
7y
I am handy myself and find it really helps with my decision making process in what I want to do to save money, and what things I want to sub out to a contractor. Since I am starting out I do like doing a lot of the projects myself to learn not only how difficult it is to say lay flooring or tile, and understand the processes to better understand the entire processes.
The way you go about your investing is one of the great options investors have!
You listed a plethora of reasons why anyone would do what you and your wife do.
Here’s my question for you..
Even though you are happy now with how you run your business, if you could hire one thing out what would it be and could you make your life easier with just hiring out one thing?
I could hire out many aspects of what we do. I just don't want to. When I buy a new vehicle (shhh! investors aren't supposed to do that) when I drive it off the lot, it's never going back. Free oil changes? I don't care, because I do them myself. It's just what I do. So unless something "requires" contracting out such as a new septic system or HVAC system, it's going to get done by my wife and I. If I had to choose one thing? It would probably be roofing.
Rental Property Investor · Goshen, OH · Member since 2017 · 58 posts · 22 votes
7y
@Trevor Neis
You tube will be your friend! Lol find a good reliable channel and follow it. This old house is a good one. RR buildings is excellent to follow as well. Less remodeling on his channel but great work and advice!
Books are good to but not my style.
Watching how and jumping in head first isn’t a bad thing.
Other wise there are contractors out there that don’t mind free help. Just ask one until you find one. :)
Investor · Mancelona, MI · Member since 2019 · 43 posts · 24 votes
7y
I have a ton of skillsets from electrical, plumbing to siding and roofing. I find it amazingly helpful. I tend to buy houses on auction so I have no bills aside from taxes and utilities until they are ready. I come home from work and go over to whatever new place I have and work. I enjoy it and I pay no companies to do anything. I save an enormous amount.
Then when it's done over the course of several months, I appraise it and refinance, then rent it.
For example, I bought a SFH, 5 br, 2 ba for $30,900 and it appraised out at $120k with 16k of materials into it. I refinanced out 70k since that's all rent would cover for it's mortgage and moved on to the next one with a ton of equity. Huge profit margin mainly gained from just not having to pay for labor and being able to take my time and do things right.
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
7y
@Ezra Harris Being handy and knowing what it takes to fix things is a huge benefit when you are investing in real estate. It doesn't mean you have to physically do all the work, just having the knowledge can save you a lot of time and money.
Can you invest without being handy? Sure, I am not handy, but it was a lot of trial and error to learn what works and what doesn't. Sounds like you will have little or no learning curve in that area which is awesome.
Investor · Joplin, MO · Member since 2015 · 76 posts · 78 votes
7y
@Ezra Harris
Being handy is handy. We don't do our own electrical or plumbing, pay a professional. But it is nice that my wife could paint professionally and I can do flooring, sheetrock and windows. I use to do our roofing, but have reached an age and level, where I say screw that let someone younger get on a roof. I estimate by being moderately handy can save me anywhere between 10 to 12k on flips.
Rental Property Investor · Goshen, OH · Member since 2017 · 58 posts · 22 votes
7y
@Michael Noto
I think the greatest most forgotten way of learning how to be handy is the passed on kind.
I say this very carefully because I don’t want to bring up bad memories for those with bad or none existent fathers but 50 years ago just about everyone knew how to do everything themselves.
And they learned it from their father figure.
By the time a person was 18 they could practically build a house.
If we could find a way to replicate that again competition sure would be tough in the real estate field. 😄.
Saying that here’s a question..
You said you had to learn to be handy, what would you say is the best way to learn that nowadays?
Specialist · Member since 2019 · 137 posts · 125 votes
7y
With me I always ask myself, "What is the highest / best use of my time & talent?" and that is the best starting point. I wouldn't always use the money equation either. Sometimes it's incredible satisfaction. However, if it would make me a "10" Satisfied to custom lay shower tile in a unique pattern but my time, the value of the pattern compared to me working doing research at the courthouse or going to an auction while a skilled craftsman who has the tools, skills & follows the pattern I want isn't worth it - it isn't worth it. It depends on how high level of skill you have, tools you have and time - compared to what you can do in other areas.
So Ezra, when you asked the other poster "Do you think having these skills will hinder you from scaling hirer than a certain number of properties.
Or do you feel that once you reach that “number” it will be easy to transition from doing it yourself to hiring it out?"
It depends on what you feel comfortable letting go of - and trust. The most successful investors know how to let go of control & have faith in the relationships they've built. Not blind faith - but professional trust that has been built.