A Fair Price to Pay Contractors - Per Rehab

[Account Closed]

Hello,

First post on BP.  

I'm in the earlier stages of writing a BP to acquire and lease rental homes.  I'd like to outsource the rehabs to contractors and consider their wage in terms of the "total investment" of the subject property.  

I was thinking a good way to determine their wage would be to consider it a percentage of the bid or SOW.  

For example, if the contractor bid a house at 10k, suppose I cut a deal with that contractor so that they get paid 10% of the bid.  In this case, 1k.

Of course, I'd have to stay on that contractor to make sure they're not overbidding as a mean to increasing their commission.  

What would you suggest as a fair percentage of the bid as a payment (10%, 15%, 20%)?  Or is there perhaps a better way of doing this.

Thanks,

-wormbite

[Andy Collins]

In the DFW area good contractors are hard to get scheduled right now,,,if you go asking for some sort of discount or paying them with anything other than cash,,they will laugh at you.

I just got through waiting nearly 2 months for my favorite contractor to work on a ceiling in a living room, it wasn't an emergency, and I have to wait while he does $50k bathrooms in rich areas, to come work on my rentals,,,thats the way it is right now

And BTW, I still don't understand what your talking about 10% of their bid etc..please explain, I must be a little slow