I currently own 10 units (2 duplexes and a 6-plex.) The duplex I just purchased vacant and it needs some cosmetic work. The 6 plex is currently only 50% occupied and 2 units need some thorough renovating (all new flooring, cabinets, bathroom gut job, wall taken down, etc.)
I have yet to establish a real great relationship with any contractors in the area. One group quoted me $12,000 to remodel 1 unit. Mind you, this is an upper C to lower B class property. The other folks I've worked with are better on price, but flakey and not great at sticking to deadlines.
My most recent idea was to basically "hire" a part-time handyman-type-fella. Someone that I interview, determine their credibility, and then basically keep "on call" at all times to handle anything that comes up. Whether it be checking a leaky faucet, or working on a total rehab. I was thinking that, due to cash flow limitations currently, I'd find somebody who'd work for around $20/hr for 15 hrs/ month. As I get more units, the hours could continue to grow. Or especially if I purchase a flip property, the guy could work as many hours as he wanted and potentially help GC the project.
Is this a foolish strategy? Are there even guys out there who would fit this bill? My biggest hold-up is wondering whether there is someone who's schedule works out well enough that they have an extra 15hrs/ month free to be "on-call". They certainly wouldn't always need to drop what they're doing to respond to a call, but there will be those occasional emergencies.
Is this idea worth pursuing or should I just keep searching for a contractor I can bring in on an as-needed basis? Thanks for your input.
Check and see if your state has requirements for licensing of handymen. Here in Arizona, we have a handyman exception that allows for work up to $1000 including materials on each property. Above $1000 requires a licensed contractor if the property is going to be for sale or rent. Good luck.
I would work with local 'contractors' and handyman and feel them out job by job having them bid per job allowing you to get a feel for them in person and how their work is after they have done some stuff. Bring them to the 6 plex and take them through the first unit you intend to flip. Be clear and upfront that you've got more units but you want to test them out on the first unit first. If it seems to be going well you can show them a second unit and get them more interested. From their perspective you've got lots of work to keep them busy to keep them getting paid. This means they have less time to spend looking for the next job. Ideally, it would be best to have the same person/company handle each plex unit so they can reuse materials, cut down travel costs etc.
I would avoid the 15 hours per month approach to an on call handyman. When you have a turnover that could easily eat up all 15 hours in a month while others months it might be 5. Again, it comes down to stability - a turnover or two per month would be fantastic but when its slow I might not get to issues that need addressing because I'm either working other jobs or looking for other jobs that are bigger. 15 hours per month just isn't much to rely on.
You can use the strategy I found myself in. I got hired as a PM to take care of the showings, listings, advertising and what repairs I could in an apartment. Made a flat fee per month for showings and collecting rent and then an hourly rate for repairs. Although it took me longer I was still way cheaper than a $50/hr specialist. I happened to be eager to learn the business and knew my way around repairs enough that I could learn things on my own.
I Trade rent for handyman services (We own 21 units and are in the process of purchasing more). There are tax advantage for using a resident manager (and I always have enough work to keep him busy).
We have a live-in at our 6-plex & it's been a great experience. He gets a break on his rent & is amazing with tile, drywall & now the odd frozen pipe!!!
We inherited the old guy that came with the place (lived there 24 years rent free) but had to evict him due to shoddy unsafe work that still haunts us.
@Dan Kelley Would you work how you described ? I doubt that you will find an handyman to hire at that low number who is "on call" . You would be better to have a relationship with a small contractor you can trust .
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