The importance of time.....

[Bruce Woodruff]

The posts from new investors regarding renovations, flipping, remodeling seem to always leave out or gloss over what is the most important aspect of the whole project - Time.....

Everyone is penny pinching and trying to save a few hundred or even a few thousand dollars. To be honest, when I was doing Flips, I did too. Even though I knew better deep inside. We all run tight on Investor projects, right....? Buy low, sell high is the mantra, that puts the focus right on the almighty dollar right from the start.

But it is not the dollar that drives the project, it is time. Having done not only Investor remodels, but also million dollar remodels, I can say with certainty that Father Time and Mr Murphy are working hand-in-hand to screw you. It is virtually impossible, for even a veteran Contractor, to stay on schedule. We find problems that were not in the SOW. They appear in every single job, it is just a fact of life, so you had all be ready for it and have a plan...on every project. 

1) There are real-life 'people problems' - employees (or Subs) get sick, their trucks break down. 

2) Vendor/Supply Chain issues - a special-order Lami beam, or kitchen cabinets, show up 2 weeks late

3) And the big one - Change Orders have become not a rare occurrence but a given on every job. And yes, this includes you as an investor on your own investment property. Your or your partner's wife will change the kitchen layout every single time...and if they don't you will add a game room in the garage.

So my point is this - you most likely will not be able to get rid of schedule/time issues, so just be aware and ready...they could be the variable that decides whether you make or lose money on your project.

[Garrett Crosby]

This is the conversation that should happen before every flip, not after. Time is the one cost you can't negotiate down or shop out.

When I run the numbers on deals I'm evaluating or helping clients evaluate, I build in a time cushion right into the model — not as an afterthought but as an actual assumption. If the project is expected to take 90 days, I underwrite 120. If I get the rehab done in 90, great — that's upside. But if I don't build the buffer in from the start, every week over schedule feels like an emergency instead of a predictable reality.

The change order point is the one I always emphasize. Every change order has a dollar amount and a time amount. Most investors only fight about the dollar amount. The time cost — delayed subs, re-sequenced work, inspection backlogs — often costs more than the dollar figure on the CO.