How do you save money on your house flips?

Question

Hey Flippers!

With each flip we do we seem to learn new tricks to save money(and increase profits).  I’m just wondering if anyone would be interested in “trading secrets” 😂 here are a couple of mine:

1. Check Best Buy for “open box” appliances.  Just because it has been returned doesn’t mean it’s damaged! On our last flip we got a stainless French door fridge for $375, saving us around $1000!

2.  Habitat for Humanity ReStore/big box returns for replacement doors. We can usually find interior doors for  $15-20 and exterior doors for $35-50. In our last flip this added up to over $500 in savings(a lot of kicked in and doggie doors 😂).

Now let’s hear some of yours!

Greg Dickerson · Answer

I focus on doing fewer bigger deals with larger margins and outsource everything turn key. I have detailed sytems and specifications so the GC knows exactly what to do. This allows me to spend all my time finding great deals, lining up the funding and getting them sold. You can also go the volume route this way if your market sweet spot is on the lower end. Either way the best way to scale is to systemize the process and let your contractors supply all materials and labor. Your time is way better spent on the high level task vs trying to save  a couple hundred or even a couple thousand dollars doing things yourself and purchasing materials direct. That will cost you way more in the long run unless you have a building company or are doing enough volume to hire a PM to manage subs. Even then Instill let subs supply all materials and make a little extra. This keeps them loyal and responsive. Also you don’t have to deal with callbacks or warranty of you let the GC and or subs supply materials. It’s on them.

Max T. · Answer

I will do some of my own carpentry (framing, cabinets, tiling) to save money.

Trenton Miller · Answer

My biggest advice would be to streamline the finishes you choose and purchase yourself.  By doing this you know what materials will cost you and you will not be paying for markups with GC's and or Subs.  This goes back to the analyzing phase as well.  If the numbers don't work when analyzing the property based off the finishes you want then it won't work.  Labor is the differentiating factor here.  Another tip I have is intended use.  For example, is the roof functioning as intended, or is it just old.  just because something is old but still functioning as intended does not necessarily mean you are required to improve it.  I'm a firm believer that all cost savings will be found during the analyzing. If you know what type of product you are trying to flip and provide consumers with.

Hamid Sedaghat · Answer

Develop good relationships with good subcontractors and keep them busy. They will appreciate the work, both you and the subs will what to expect, and you will have some negotiating power if you are doing a certain level of volume. But best you will have a consistent process which should yield a consistently high quality product. You can also definitely benefit from scale with costs of building materials too!