Rehab Estimates - live overseas & no local contractors!

Rehabbing & House Flipping
10yFollow

Rehab Estimates - live overseas & no local contractors!

Sarah Cox
Investor · Chicago , IL · Member since 2016 · 42 posts · 9 votes

So I have been analyzing some properties for potential fix & flip.  I am very new to this, and I'm getting stuck on trying to estimate the rehab costs.

I live in Australia (investing in Chicago area), so it's not possible to visit the properties myself.  I have tried reaching out to many general contractors in the area, and every one has told me they are too busy for any extra work right now.  My agents have tried the same and haven't been able to find anyone.

I don't feel confident to come up with a good estimate just using photos & property description. 

I'd love for someone to go to the property and at least give me a run down of what needs to be done.... but not sure who to ask or how to find someone willing to walk through the property on my behalf... 

Any suggestions?  Thanks! :)

PS: I will be wholesaling the properties, not fixing them myself ;)

1Reply
14 views

Most Popular Reply

Robert Leach
Contractor · Romeoville, IL · Member since 2015 · 198 posts · 137 votes
10y

I think you will be hard pressed to get a qualified contractor to walk your properties on the hope that they might actually get to bid on it down the road IF you are able to put together a deal. There is really no incentive without a pre-established relationship or referral in place.

5Reply
See this reply in the discussion

19 Replies

Jump to latestLatest
  • Matt Vogt
    Investor · LaGrange GA · Member since 2014 · 121 posts · 55 votes
    10y

    Honestly, I think the margins in wholesaling are too thin for you to be farming out the work. If you have an agent looking at the properties for you, I am missing the value-add you're providing (necessary to be able to sell it). Maybe I'm not understanding your business correctly, maybe it would help for you to explain what you're doing a little further.

    0Reply
  • Michael Williams
    Investor · Palmetto, GA · Member since 2014 · 190 posts · 77 votes
    10y

    Sarah what you need is the services of a birddog. Some wholesalers will do birddog services for you. Put Chicago wholesalers or Chicago birddogs in the searchbox and you should get some post pertaining to that subject.

    1Reply
  • Heather Shannon
    Investor · Chicago, IL · Member since 2016 · 15 posts · 6 votes
    10y

    I live in Chicago and have been contacting contractors the last day or two and I am getting responses.  I've reached out to 10 with good reviews and have gotten 3 responses already. Not sure how you're finding or contacting them.  Or it maybe they're put off by you being out of the country and not taking it seriously?

    Perhaps you can arrange for a realtor or friend to meet the contractor at the property and not even mention you're out of the country?

    I am also not sure how the value-add will come in.  As someone looking to rehab and AirBnB, I can't imagine paying someone a premium to find a fixer upper for me.  Do you have a secret stash of off-market properties that are better deals?

    1Reply
  • Robert Leach
    Contractor · Romeoville, IL · Member since 2015 · 198 posts · 137 votes
    10y

    I think you will be hard pressed to get a qualified contractor to walk your properties on the hope that they might actually get to bid on it down the road IF you are able to put together a deal. There is really no incentive without a pre-established relationship or referral in place.

    5Reply
  • Nino AlfanoPro Member
    Contractor · Lemont, IL · Member since 2015 · 335 posts · 76 votes
    10y
    Robert Leach is 100% accurate.
    0Reply
  • Nino AlfanoPro Member
    Contractor · Lemont, IL · Member since 2015 · 335 posts · 76 votes
    10y
    Sarah Cox if you were actually purchasing and rehabbing the property, i believe it would be a different outcome. Especially your trying to wholesale. Your going to send the contractor to 20 houses and all of them the numbers don't work. How is his time paid ?
    1Reply
  • John Weidner
    Chicago, IL · Member since 2014 · 710 posts · 200 votes
    10y

    Your wholesaling properties in Chicago yet you live in Australia.  I can't think of a worse idea.  

    How do you expect this business model to work?  

    If you continue then in your case you need to pay a home inspector about $350 to give an assessment.  No contractor is going to give free advice when they hear this business model 

    4Reply
  • Federico Gutierrez
    Realtor · Cleveland, OH · Member since 2015 · 2k+ posts · 857 votes
    10y

    @john is right. As an Aussie in the market you sound super dodgy to a contractor. I'm actually surprised you got a realtor on board

    Your going to have to fork out some cash to have these contractors go look at the properties or else they aren't going to take you seriously

    0Reply
  • Sarah Cox
    OP
    Investor · Chicago , IL · Member since 2016 · 42 posts · 9 votes
    10y

    um thanks for the support?

    Yes I realise I will need to pay the contractors for their time I'm not expecting something for nothing! 

    Why so you say my location makes me sound dodgy? Or that I'm not taking things seriously? 

    0Reply
  • Sarah Cox
    OP
    Investor · Chicago , IL · Member since 2016 · 42 posts · 9 votes
    10y

    @Michael Williams  thanks for the birddog suggestion I like that idea! I guess that I pay them their fee out of my profits after the deal closes. And there would be an agreement in place so they can't go and put in an offer themselves. I'm going to do more research but thanks again for the great idea! 

    0Reply
  • Rosd Leathers
    Contractor · Houston, TX · Member since 2016 · 1 post · 2 votes
    10y

    Sarah, maybe you should consider finding a local Realtor / Investor to partner with??? Who's gonna look out for your interest in these projects if someone isn't around keep track..., and that someone needs to have skin in the game. On the Contractor issues... The best guys make money built on relationships that are built over time, with face to face interactions. I'm a novice in the investing side of this show but I would tell you, when it comes to the contracting side of the house, you would do well to find yourself a local to partner with, someone who knows the lay of land and may have a few contracting relationships. Your profits may be less but then your investment may be as well because you're sharing the risk. 

    Just a thought

    2Reply
  • Sarah Cox
    OP
    Investor · Chicago , IL · Member since 2016 · 42 posts · 9 votes
    10y

    @Rosd Leathers yes I think you are right, it is hard building relationships when you can't get to meet people face to face. I do a lot of emailing as well, because I'm nervous about talking to people on the phone, which doesn't help either!  I do have contact with another investor here in Australia - I worked with him on the purchase of my rental property near Chicago - he is keen to work with me and partner with me on some deals, and he has many established contacts in the area.  That might be the way to go, call him and work something out (we are playing phone and email hockey at the moment lol).  More than happy to share profits! ;)

    0Reply
  • John Weidner
    Chicago, IL · Member since 2014 · 710 posts · 200 votes
    10y
    Originally posted by @Sarah Cox:

    um thanks for the support?

    Yes I realise I will need to pay the contractors for their time I'm not expecting something for nothing! 

    Why so you say my location makes me sound dodgy? Or that I'm not taking things seriously? 

    Let's see 

    You are about a 30hr trip maybe 24hrs of flight time from Australia to Chicago

     You can't know the market enough not being on the ground to accurately value properties. Value in Chicago can change by blocks.  Blocks not Miles.    You have to know your farm.  You can't possibly grasp this being in Australia.

    Your trying to wholesale on top of this not just invest.  

    I'm trying to save you money by telling you this business model is a bad idea.   

    0Reply
  • Sarah Cox
    OP
    Investor · Chicago , IL · Member since 2016 · 42 posts · 9 votes
    10y

    xenophobic much?

    only explanation i can find for such unsolicited advice!

    I guess you only invest in your own local area, never anywhere else... ever...

    too bad I've not yet worked out how to block people on this site... :(

    0Reply
  • Aaron Hall
    Real Estate Investor · Santa Rosa, CA · Member since 2014 · 60 posts · 33 votes
    10y
    Sarah Cox G'day You have opened a "lively" discussion about your business plan. I have to say it is hard to see how to value add from that distance BUT you have found GOLD - talk with the person that got you started in Chicago. Your friend has surely run into similar challenges and found a way to overcome them. Even if he doesn't have the right answer he may have someone you could ask. Remember his investment plan has different assets, resources and goals. Silly question - can you take your holiday and go to Chicago for a week or two? If you connect with some people virtually and then go to meet them, it could be just the thing to make good connections or find missing pieces. This isn't a cheap prospect but it could be cheaper than the monies lost on not having the right team.
    0Reply
  • John Weidner
    Chicago, IL · Member since 2014 · 710 posts · 200 votes
    10y

    Where does it say you are investing?  You stated you wanted to Wholesale in Chicago not Invest.  

    My comments are purely in respect to your wholesale business model in Chicago operating from Australia.   Which is a terrible idea.   

    0Reply
  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Sarah Cox:

    So I have been analyzing some properties for potential fix & flip.  I am very new to this, and I'm getting stuck on trying to estimate the rehab costs.

    I live in Australia (investing in Chicago area), so it's not possible to visit the properties myself.  I have tried reaching out to many general contractors in the area, and every one has told me they are too busy for any extra work right now.  My agents have tried the same and haven't been able to find anyone.

    I don't feel confident to come up with a good estimate just using photos & property description. 

    I'd love for someone to go to the property and at least give me a run down of what needs to be done.... but not sure who to ask or how to find someone willing to walk through the property on my behalf... 

    Any suggestions?  Thanks! :)

    PS: I will be wholesaling the properties, not fixing them myself ;)

    You will struggle doing anything successfully here in the US from Australia

    I tried and lost hundreds of thousands $$$ and that is why I moved here

    Even to this day, I loose my A$$ on deals that are right around the corner from my office.

    When you have a different accent, many folks here smell blood.

    Be very careful

    Just my opinion.

    Much success

    Podcast Guest on Show #89
    Oz Realty4.5368 Reviews
    WebsiteView Page
    0Reply
  • Lindsay Stewart
    Investor · Melbourne, Victoria · Member since 2015 · 203 posts · 58 votes
    10y
    Hi Sarah I am a Melbournite investing in US as well. It can be trick but definitely not impossible. I have been able to get contractors mainly from referrals which works the best and often the realtors have been able to help me the most. I pay them generously for their time and yes, I guess someone living in the area will make more profit on a deal, but I'm quite happy with our outcomes 😊 Reach out if I can help at all Cheers Lindsay
    1Reply
  • Manolo D.
    Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
    10y

    Paying for time is the only way this model will work.. if you play it right, there's no impossible thing..

    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free