When contractors won’t come out - need quotes

Rehabbing & House Flipping
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When contractors won’t come out - need quotes

Maxine Kunimura
Eagan, MN · Member since 2018 · 32 posts · 17 votes

Advice needed on my ‘Smelly Mansion’ please!

I’m having a hard time finding contractors willing to come out and give quotes this late in the season. I’m a new investor and I’m just beginning to work on building these relationships. I’m currently looking at a house as a live-in flip while renting the lower level (with my back up plan being a regular flip or multi rental).

It's listed for $365k but my offer will be closer to $210k due to the extensive repairs. I wanted to include add'l documents/quotes with my offer, that illustrate the cost of these major repairs. ARV would be $490k (conservative estimate, may be closer to $540k). Sellers have already moved, lots of ‘junk' still in home, and it hasn't been taken care of at all. On the MLS for 2 weeks before they dropped $15k from listing price.

What are some alternatives I can use to illustrate to the sellers the extent of the repair cost? Specifically, roofing, siding, gutters, and grading. Grading may be more complicated because we’re unsure if the foundation has the water proofing on it.

I don’t have the experience (yet) to estimate these in my head. I was thinking of writing a letter that details all the major concerns and then moving on and not letting this become a time suck before even having it under contract.

Any and all advice appreciated. Thank you!

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Ahmed Porter
Contractor · washington, Washington D.C. · Member since 2011 · 204 posts · 64 votes
6y

this time of season we are busy offer to pay them for the estimate they will be out like 125 to 150 for the estimate.Also, try to create a relationship with a few send them a job from time to time and when its time to for your job you will get more prefrontal treatment than someone that just calling

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  • Nicholas Salnicky
    Contractor · Omaha, NE · Member since 2019 · 20 posts · 1 vote
    6y

    @Maxine Kunimura

    You are going to have to pay a good contractor to come out. I would say to treat him how you would want to be treated in that situation. I'm sure you value your time. Pay him well and i would say to tell him what you are doing and if you are sincere and arent going to nickel and dime him on jobs, i would say they are willing to help. L

    A general contractor is going to hit you for at least 15% for the project management and supervision of the job and having to pull in his resources to do a complete home remodel.

    I have my class c gc license and would say to find sub contractors that are in the specific field of work you need. But on a property you haven't secured yet also thoughts another kink in there.

    Also realistically even if the contractor makes you a list of the work, me being a contractor and submitting offers with things that need done, if it's on the mls i would say best of luck to you trying to gget the home... i can't imagine the comps that a real estate agent who put together a CMA would be over 100k off.

    I apologize if this sounds rude but i would not spend too much time with perspective investments like this. It sounds like you are forming a personal attachment to the property for some reason. It sounds like you are hell bent on getting this particular property when it's just about the numbers. It sounds like you have a case of Hopium. But i do hope you realize that it's a numbers game. Also i wouldn't go with rough estimates. It's all about the numbers and they are critical.

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  • Jonathan W.
    Los Angeles, CA · Member since 2019 · 512 posts · 301 votes
    6y

    @Maxine Kunimura the chance of them actually getting the work, is very very slim. Because a lot of things would have to happen out of their control for the job to be there’s. Like your offer has to get accepted...so money talks, incentive

    I honestly don’t think your offer will ever get accepted

    Even if your right

    The seller listed it at how much?!

    Even if you can prove all these things, doesn’t mean he or she will think you’re and will go near your price.

    We once make an offer on a home that was definitely outdated and it was owned in a trust

    We made an offer of like 30-45k less. It got turned down and 6 months later...probably more, it sold for close to if not lower then the price we had offered

    They could have done a lot better selling to us initially then holding onto it and selling it after more expenses are incurred.

    So just cause you can justify your price doesn’t mean the seller will see it your way or care.

    That’s my opinion I wanted to share before you waste $$$ researching a project that has very little chance of even happening.

    Either way I wish you good luck

    2Reply
  • Maxine Kunimura
    OP
    Eagan, MN · Member since 2018 · 32 posts · 17 votes
    6y

    @Nicholas Salnicky

    I’ll admit I had gotten pretty excited about the property but have since moved on from getting my hopes up. I actually found a great rental in the same area for $280 that needs much less work and is better suited for a new investment.

    1Reply
  • Nicholas Salnicky
    Contractor · Omaha, NE · Member since 2019 · 20 posts · 1 vote
    6y

    @Maxine Kunimura

    That's probably the best idea on your situation, look for a property that is more cosmetic instead of a total disaster.

    Once you have a property secured it'll be a lot easier to get a contractor out there, and then you can pick his brain and form a business relationship and he'll see that you're not just burning his time.

    1Reply
  • Gail W.
    Rental Property Investor · Running the Earth, watching the sky · Member since 2013 · 64 posts · 18 votes
    6y

    Thank you, @Maxine Kunimura for posting this question. It was my exact conundrum. I figured out pretty quickly that the contractors that DID come out wouldn't put anything in writing unless I offered them some money for their time. I found 2 who were very nice who DID, and would hire the one in a heartbeat (the other is retired). 

    But yes, if you are just starting out OR are used to doing everything yourself (but need professional quotes for some reason), this wouldn't be something you'd automatically know. Not all of us are Thornton Mellon.  ;)


    1Reply
  • Ryan Landis
    Residential Real Estate Broker · San Mateo, CA · Member since 2013 · 585 posts · 264 votes
    6y

    @Maxine Kunimura it's tough because anytime a GC is any good, they likely will be booked out and the idea of going and taking a look at a property to do a job, knowing that you are not already under contract and going to close is tough. They may be willing to go out for a fee, but that gets tough from your end because you don't have it under contract yet either. 

    The best approach is just be a little bit extra conservative and put together what you think is a rough bid to get an idea on costs. See if that makes sense, speak to the seller's agent about it, and if they are willing to play ball at half the price then it may be worth putting a bid in place.

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