Thoughts from a contractor/investor perspective

9 Replies | Cleveland, Ohio

I wanted to share some thoughts from what I think is a fairly unique perspective. As both a real estate investor and a contractor whose business is built almost entirely on working with and for out of state investors, I get to partner with and learn from a wide variety of people from all over the world. Below are some observations I think could be useful as we all continue to pursue our goals.

The most successful people I work with and for have a few things in common. First, they are all more organized than most people. Some understand construction, some don't. Some are very active in the rehabbing process, some are not. Some are very particular about finishes/colors/materials, some aren't. But all my most successful partners and customers are organized. They know what's going on, they set goals and deadlines for me and themselves, and they take action and make decisions. If you struggle with this, you may want to regroup and check your processes before you push forward. It will make your chances of success much greater.

The most successful people I interact with don't live or die by the numbers. I see a lot of people who spend hours crunching numbers, churning out spreadsheets, and analyzing deals from every possible angle. The most successful people I work with are certainly driven by a particular set of financial objectives - but they don't get wrapped around the axle about them. They do their math, review their options, and then go like hell to make their deal work once they make the call. I work well with those types of folks, because rehabbing distressed properties is NEVER a linear process. It is imperative to put a plan together when starting a project, but I have yet to do a project (I'm well over 100 projects/deals for perspective) that went the way we drew it up. Which leads me to my next observation...

Successful people roll with the punches. Things are going to go wrong. Sometimes because you screwed them up, and sometimes because of things completely beyond your control. The successful people I deal with understand this, take the standing 8 count when things go sideways, and then refocus on the end game and try to get back on track as quickly as possible. I have had crazy stuff happen that I had no control over that had to be dealt with - like a tenant trying to grope me when I went to fix her furnace. And I have had to deal with stuff that I screwed up that was 100% my fault. I put the wrong tile in a customers shower last week - completely my fault. I offered to redo it at zero additional cost to make it right with my customer. They expressed their displeasure and moved on to get the project done without drama. Successful people recognize that not every thing that goes wrong is major, and they focus on the bigger picture and fight through issues.

Successful people develop relationships with people they trust, and then lean on those people to solve problems without second guessing every detail. I have one customer who will call me and tell me when he is closing on a deal, and ask me to have a crew there to start work the day after closing. No contract, no scope of work, no discussion about anything. He trusts us to do the right thing for him based on a history of us looking out for him. Once we start, we work out the details. That said, the same guy is a tough negotiator, and is always challenging me to cut costs, find ways to get done faster and more efficiently, and leaning on me to help him reach his goals. He has a few realtors and other folks he leans on in a similar fashion. He's no pushover, but he also knows that continuing to work with people he can trust, even when things go wrong (and we have screwed up stuff on his projects plenty of times) is a recipe for success. He knows we will always make it right, and we recognize that his success is our success. The thought process is not to try to get a bigger piece of the pie - it's to make the whole pie bigger so everyone gets a bigger piece.

Not sure if all this rambling makes sense, but I wanted to share what I have learned from all the folks I have been fortunate to work with. If you read through the traits above that all my successful customers and partners share, I think there is a lot of value for any investor, regardless of how much or little experience you have. The best part of my career is learning from all the talented people I get to develop relationships with, and I look forward to continuing my education!

Feel free to share your thoughts/observations about what traits you or other successful people have in common. It helps all of us. 

Hey @Joe Canfield !

Thanks so much for sharing your wisdom over the years of working with a variety of people within the industry. The perspective you bring to the table is really crucial here, one of both an investor and a contractor. From what I have seen and experienced, investors and contractors, for the most part, think VERY differently. So that fact that you have the ability to see both sides of the equation is immensely valuable for your clientele. 

As a quick disclaimer here, our team currently works with Joe and his team and just began a business relationship together. So far, he has been nothing but professional with us, responsive, understanding, and flexible. Joe, I know your post wasn't at all about you marketing yourself, but I just quickly wanted to chime in and tell all the folks that read this that I seriously haven't met a contractor like him. Although we just began work with him, he holds himself and his business at such a professional high standard that he has built immediate trust with us.

Through reading through what Joe had to say about who he identifies as those who are/will be successful in this industry I couldn't agree more. Although our company is young, we hope to grow and learn from people like Joe who have this kind of experience and wisdom, and all of those reading this should as well.

Being successful in real estate is difficult, and being successful in life is even more difficult. But if you continue to learn from those who have been "around the block" , read, develop systems, engage with others and apply what you learned, overtime you might just find yourself exactly where you want to be in your career and life. 

Thanks again for the insight Joe!

Updated about 1 year ago

Hey BP Clan! I just wanted to create a quick update in regards to my experience working with Joe. This update is definitely quite late, but it's better than not making one at all. When I wrote my original post our team was in the very early stages in terms of developing a business relationship with Joe and his contracting crew, several BP members have reached out to ask of my experience with him. Unfortunately, I wrote the post in a way "praising him" too soon and I apologize for that as my experience with him and his crew was actually quite pitiful. In this respect, I advise you all to not make the same mistake that I did with giving credit to someone before it is earned, I have learned my lesson. In general, Joe talks the talk, is marketable, friendly, and responsive, however the guys he selects for his jobs are downright awful (at least on my projects). His team was put on two minor turnkey rehabs ($30K of work total between the two), projects that should have easily been knocked out without many mistakes in less than 6 weeks. Every time I went to check on how the rehabs were going (which was several times a week) very little work was accomplished and the work that was done most of it had to be redone. For example, I asked them to refinish the hardwood. Sure they got it done, but there was visible and obvious globs of polyurethane concentrated in various areas almost like pools, the work was horrendous and I needed to have to refinish the floors entirely again. There where several other examples of poor attention to detail such as outlets that went in crooked, handicapped shower head drilled right into drywall without any anchor, light fixture fans installed bent so when they were turned on would sway awkwardly and make horrible noise, a lot of little things added up to poor workmanship overall. Additionally, the works was accomplished very slowly and I needed to have a conversation with Joe at the end of each week why so little work was finished and to get his butt in gear. After 4-5 weeks of this, we let him go and hired a new crew to finish the job. If you decide to go with Joe Canfield, maybe you will have a better experience than I did, but from what I experienced I would advise someone who manages more closely and puts qualified contracts on your project. Best of luck, as finding and working with quality contractors in my opinion is the most difficult part of the business!

Thanks for sharing Joe.

It's crucial who you work with.

I learned my lesson the hard way. Unfortunately the first contractor I hired did more damage than good. It's complete fraud and I was seriously screwed. The other two contractors referred by PM were not good either. There's constant delay, very annoying.

@Joe Canfield I loved reading your post because it gives a good perspective to someone like me that is just getting into the Real Estate universe.  I've been looking at different properties out in Cleveland, still trying to figure if they make sense for me but it's always fun to do detective work and try to find a good deal. LOL!!

Just want to add that, just gave a decent sized rehab 50k+ project to Joe. He was extremely prompt and was willing to look at my lens of my financial goals on my flip.

100% agree with Joe. Macro big picture plus Decisiveness is the key. I recently teamed up with a partner for a local flip in Oakland. We met for coffee and in 30 min agreed on terms. No back n forth , no legal nonsense. Just trust and instincts. It was close to a 400k investment from my side but I was very confident of making money with him as a partner.

@Joe Canfield - I think you hit the nail right on the head.  I definitely agree with your thoughts (I'm a contractor, do my own work on my rehabs, hire out other stuff) and you definitely have great points.

Keep up the good work! Hopefully some newbies (and maybe those seasoned investors who struggle in other areas) will take away some good points from your post.

@Joe Canfield Great post! Thanks for sharing you insight. I heard of many tales about contractors ripping off investors and home owner. Nice to know that you're one of the good one! 

 Liked "The thought process is not to try to get a bigger piece of the pie - it's to make the whole pie bigger so everyone gets a bigger piece." 

Trust does not built overnight, base on how you're customer trusted you. It seem like relationship building is more valuable than $$(Just stating the obvious) =)

Originally posted by @Joe Canfield :

I wanted to share some thoughts from what I think is a fairly unique perspective. As both a real estate investor and a contractor whose business is built almost entirely on working with and for out of state investors, I get to partner with and learn from a wide variety of people from all over the world. Below are some observations I think could be useful as we all continue to pursue our goals.

The most successful people I work with and for have a few things in common. First, they are all more organized than most people. Some understand construction, some don't. Some are very active in the rehabbing process, some are not. Some are very particular about finishes/colors/materials, some aren't. But all my most successful partners and customers are organized. They know what's going on, they set goals and deadlines for me and themselves, and they take action and make decisions. If you struggle with this, you may want to regroup and check your processes before you push forward. It will make your chances of success much greater.

The most successful people I interact with don't live or die by the numbers. I see a lot of people who spend hours crunching numbers, churning out spreadsheets, and analyzing deals from every possible angle. The most successful people I work with are certainly driven by a particular set of financial objectives - but they don't get wrapped around the axle about them. They do their math, review their options, and then go like hell to make their deal work once they make the call. I work well with those types of folks, because rehabbing distressed properties is NEVER a linear process. It is imperative to put a plan together when starting a project, but I have yet to do a project (I'm well over 100 projects/deals for perspective) that went the way we drew it up. Which leads me to my next observation...

Successful people roll with the punches. Things are going to go wrong. Sometimes because you screwed them up, and sometimes because of things completely beyond your control. The successful people I deal with understand this, take the standing 8 count when things go sideways, and then refocus on the end game and try to get back on track as quickly as possible. I have had crazy stuff happen that I had no control over that had to be dealt with - like a tenant trying to grope me when I went to fix her furnace. And I have had to deal with stuff that I screwed up that was 100% my fault. I put the wrong tile in a customers shower last week - completely my fault. I offered to redo it at zero additional cost to make it right with my customer. They expressed their displeasure and moved on to get the project done without drama. Successful people recognize that not every thing that goes wrong is major, and they focus on the bigger picture and fight through issues.

Successful people develop relationships with people they trust, and then lean on those people to solve problems without second guessing every detail. I have one customer who will call me and tell me when he is closing on a deal, and ask me to have a crew there to start work the day after closing. No contract, no scope of work, no discussion about anything. He trusts us to do the right thing for him based on a history of us looking out for him. Once we start, we work out the details. That said, the same guy is a tough negotiator, and is always challenging me to cut costs, find ways to get done faster and more efficiently, and leaning on me to help him reach his goals. He has a few realtors and other folks he leans on in a similar fashion. He's no pushover, but he also knows that continuing to work with people he can trust, even when things go wrong (and we have screwed up stuff on his projects plenty of times) is a recipe for success. He knows we will always make it right, and we recognize that his success is our success. The thought process is not to try to get a bigger piece of the pie - it's to make the whole pie bigger so everyone gets a bigger piece.

Not sure if all this rambling makes sense, but I wanted to share what I have learned from all the folks I have been fortunate to work with. If you read through the traits above that all my successful customers and partners share, I think there is a lot of value for any investor, regardless of how much or little experience you have. The best part of my career is learning from all the talented people I get to develop relationships with, and I look forward to continuing my education!

Feel free to share your thoughts/observations about what traits you or other successful people have in common. It helps all of us. 

Wow Joe. This is awesome. I went in and used (abused?) my BiggerPockets Super Powers to highlight the points you were making. This is fantastic. (Even my BP Super Powers don't give me the ability to vote more than once, unfortunately.) 

@Joe Canfield is NOT LEGITIMATE. Work with him at your own peril, from my personal experience as well as several other folks in the area that I have connected with after cutting ties with Joe. 

He WILL take your money and RUN

He WILL NOT do what he promises