Originally posted by @Will Barnard:
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That is a very common and typical situation/mistake that we Investors all make when starting, trying to save every dime to make the most by doing things yourself. When you factor in the extra hold time for going slower and the fact you spent time doing physical labor rather than other more important aspects, you realize you made less going down that road.
That said, that very same real world lesson is crucial so I often invite new investors to try going the hire each sub version even though it is more time intensive and even doing things yourself as you learn how much it should cost to “swing the hammer” and how long it should take to do the same. Those life lessons in real estate really helped me with scaling my business.
It's not necessarily a "mistake", unless you have been in the trades, or a long time home owner, "doing it yourself" the first time (or few times) has the education benefit of learning what you don't know. Plus, on the first few, you just might not have the upfront cash to "hire it out"
For example, I do my own electrical in my personal residence, and from that, I NOW it doesn't "cost" a lot in materials for electrical work (aside from some specialty breakers, GFCI's, etc.), but the labor is more intensive than you might think, so that $3500 bid is not unreasonable, unless it has $2k+ in materials....I also know I am not going to do the electrical in my REI due to the time/effort involved even though I could save $2.5K on that $3500 bid...it's not worth the week It'll take me, plus the "permitting lag" that happens if you aren't a local tradie, which sets back pretty much everything else, drywallers, flooring, cabinetry, paint...etc. Same with Drywall, I know what good drywalling takes from having done my own, and choose to hang it myself, but hire professionals to mud and tape and do the skim coat. Painting...depends, etc. You find these out from doing.
But congrats! I don't do flips but maybe I should look at them :D +30k in 3.5 months....nice.
Jay