Real Estate Agent · Turlock, CA · Member since 2016 · 28 posts · 7 votes
I contacted a few contractors in my area to have them give me a ballpark estimate on a few potential investment properties so I could run the numbers. Unfortunately, each of them wanted some fee in order to give me a ballpark figure. Time is money and I can respect that. I explained my plan was that if the numbers worked out and I was able to get the home, then I would agree to giving them the first opportunity to bid the home, and I would definitely pay for the time it took to write up a rehab estimate to submit to the lender. It didn't seem as though that was an interesting proposition, because I couldn't get anyone to agree to that. If I only end up getting 1 of 10 houses that I try for, the cost of a ballpark fee will start to add up. Does anyone have any suggestions? Should I just pay a fee, and if so, what do you pay? Or, does anyone know a good contractor in the area that is Fix and Flip friendly, and doesn't charge a fee? Thanks!
Northern, CA · Member since 2014 · 674 posts · 444 votes
9y
@Account Closed I'm sure an HML will only take a bid from a licensed contractor. Just be honest with seller, state that you have guesstimated rehab costs but will be bringing in a professional contractor once a sales price is agreed upon in writing and if there are major differences you will bring it to their attention. I've done a couple rehabs now so I'm pretty confident walking through and having a rough estimate. I wasn't able to get really close the firs round couple time since using a list of average prices per job for rehabs.
Contractor · Atlanta, GA · Member since 2008 · 978 posts · 985 votes
9y
Such is life. Somewhere, there's a contractor complaining that he ballparked 10 houses and only got the 'opportunity to bid' on 1 of them... a pretty bad use of his sales time.
Northern, CA · Member since 2014 · 674 posts · 444 votes
9y
do your best guesstimate on repairs and get the house under contract with contengencies. You can then take bids and use those to negotiate the purchase price down if your original estimate was too low.
Real Estate Agent · Turlock, CA · Member since 2016 · 28 posts · 7 votes
9y
Thanks Lee S. ! I'm reading J Scott's book on estimating rehab costs right now in hopes that I can make some semi-accurate estimates on my own. Do you know where HMLs stand on quotes not performed by a contractor?
Northern, CA · Member since 2014 · 674 posts · 444 votes
9y
@Account Closed I'm sure an HML will only take a bid from a licensed contractor. Just be honest with seller, state that you have guesstimated rehab costs but will be bringing in a professional contractor once a sales price is agreed upon in writing and if there are major differences you will bring it to their attention. I've done a couple rehabs now so I'm pretty confident walking through and having a rough estimate. I wasn't able to get really close the firs round couple time since using a list of average prices per job for rehabs.