First deal - DIY or Sub it out?

Question

I'm not far from making my first fix and flip deal, and am wondering if I should do it myself or sub it all out. I have very little experience renovating but am confident I can paint, install vanities, and install vinyl flooring.

I understand that long term I should not do it all myself because that makes scaling impossible, but for the first deal would you guys recommend DIY or subbing it all out?

Greg H. · Answer

If this is something you want to pursue I highly suggest doing some of the work early on.  Today I do not participate but at the beginning I did a bunch without much actual knowledge.  Fast forward 30 years, when a contractor comes to me with an issue at least we can have an intelligent conversation because I was in the trenches and I can help solve problems.  Problem solving is one of the most if not the most important qualities in this business

Marcus Auerbach · Answer

I am pretty handy and I really enjoy it, so it was tempting to do a lot myself, but you quickly find out that you can only do low-quality tasks such as junk removal, demo, painting, ob clean up.

Contractors are faster and the result looks better. On a flip that is crucial. I can always tell when the workmanship on a flip is not on par and that's probably the biggest risk - you won't be able to find a buyer. That's worse than having to lower the price and lose 20k. I have also seen enough failed flips, where the investor ran out of money half way through. And then the workmanship was so bad that the new buyer had to rip it all out and start over. You would probably do better, but ust saying. Our average BRRRR takes about 500 man-hours. That's the other issue, how much time do you have?

I would definitely recommend to work alongside the contractors as much as possibly, clean up the job, do supply runs to Menards so they can focus on productive work, heck there was a tine when I would even get them food so they could keep working :-)

Jaron Walling · Answer

@Kate Sanchez Unless they're experienced or buy an amazing deal I can guarantee the "buffer" is saving on labor. We followed the BRRRR strategy from about 2018-2023, and saved thousands on labor. It's honestly how the deals penciled out. We demo'd properties and filled dumpsters, got deals on materials, and did kitchen and bathroom remodels. We used cash and credit cards. We know the basics of PEX plumbing, bought some tools, and know how to tie into cast iron plumbing. Plumbers can charge $75+ per hour so instead I bought $50 worth of tools. The tools paid for them self 3X over.

Peter Mckernan · Answer

I would get a GC, there are so many times where if I did the deal and sub it out something would go wrong or I would really just lose the profit because it took too long to rehab. There are life lessons on taking the more costly road, learning and then down the road GCing it yourself.

Jaron Walling · Answer

@Spencer Sturgill The biggest cost to flip or BRRRR real estate is the labor. What's your time worth?

If you're young and able I strongly suggest to swing some hammers and DIY a few projects. Hire out the dangerous and heavy jobs. You'll learn a lot and save $$$ along the way. That's what most investors need when starting out; a strategy, budget, experience, and margin.

Spencer Sturgill · Answer

@Jaron Walling that's what I'm leaning toward, especially because having that experience will help me know what I'm talking about when I eventually use subcontractors. I also have more time than money, so it seems DIY might be the route to go.

Kate Sanchez · Answer

@Spencer Sturgill  Congrats on nearing your first deal! Starting hands on can build valuable insight and save costs. Just don’t let DIY delay the timeline. Have you built a repair budget with a buffer?

Spencer Sturgill · Answer

@Greg H. Those are wise words. Have you been flipping for 30 years? Did you eventually shift from prioritizing flips to long term rentals?

Jaron Walling · Answer

100%! That's exactly what I did starting out. The first few houses we did were cosmetic+ rehabs with budgets around $20k. This included new roofs on the properties. In today's market with everything hired out that's impossible.

First deal - DIY or Sub it out?

Most Popular Reply