How to Hire a Contractor You Can Trust
The key to running a successful property business includes having a team of reliable, contracted professionals to keep your rental property in tiptop shape.
In addition, you are going to want your Rolodex of contractors to be experts in their field, be affordable, and be timely.
This is what your tenants expect from contractors making repairs on the rental they lease from you; therefore, you should expect the same.
And this is especially true because many times the cost to make repairs, perform maintenance tasks, or add improvements to your rental is going to be coming straight out of your pocket.
But how do you go about hiring a contractor you can trust to work on your investment property?
If you are looking to hire a general contractor to help you with a major repair or improvement to your rental property, or simply want to put together a maintenance team to handle tenant repair requests, check out the below tips you can use while scoping out the best professionals in your area.
Finding a Reliable Contractor You Can Trust
1. Get Recommendations
To start, talk with family and friends that have experience working with contractors in your area.
Word of mouth is typically the most reliable source.
If your friend or family member had a bad experience, they will be sure to tell you.
In addition, you can always check the National Association of the Remodeling Industry for a list of contractors in your particular area based on specialty.
And, when all else fails, meet with a building inspector and find out which contractors meet code requirements, and are safe to hire.
2. Ensure They Are Licensed, Bonded, and Insured
These three terms are crucial when it comes to hiring a contractor to do work on your investment property.
- Licensed. Indicates an exam has been taken and passed, proving knowledge of building codes and processes. All contractors will have a license number you can authenticate.
- Bonded. Purchased by contractors, bonds serve as a type of insurance to protect you, should the contractor fail to complete the job properly, or fail to pay for permits, subcontractors, or others involved in the job.
- Insurance. Places liability on the contractor, should they damage your property in any way or become injured while on the job. It also covers neighboring property damage.
No matter how highly recommended a contractor is, if they do not come licensed, bonded, and insured, they are not worth the risk.
3. Choose an Expert
There are many different kinds of contractors out there.
Here are a few examples of the type of work contractors can perform:
- Framing and carpentry
- Electrical work
- And much more
In the end, if you need flooring work done on your rental property, and you hire a plumbing expert, chances are you are not going to get high-quality workmanship, even if the plumbing contractor assures you he knows what he is doing.
4. Interview Potential Contractors
Once you have researched the contractors that have been recommended to you, and you are sure there have been no complaints filed against them by prior customers, you should take the time to meet with them before hiring.
Here are some questions to ask during this interview:
- How many years have they been in business?
- What is their work procedure like – contract drafting, supply purchasing, work timelines, etc.?
- Are they willing to provide references or previous client contact information?
- Who are their suppliers?
- What is their relationship with their subcontractors?
- Do they have evidence of insurance, bonds, and licenses?
It is your job to conduct due diligence when it comes to hiring a contractor to perform work on your rental property.
Make sure you understand the entire process, from start to finish, before giving them permission to proceed with their work.
5. Get Multiple Bids
Even if the first contractor you talk with gives you exactly what you want, it is always a good idea to get second and third opinions.
You never know what other contractors may be able to do for you.
When getting bids from contractors, make sure they show you all the details related to your project. This includes blueprints of the project, projected budgets, and a breakdown of all costs for materials, labor, and overhead.
It is also good to keep in mind that cheaper does not always mean better.
A contractor with less experience, or a problematic past may be more apt to offer you their services for cheaper than the reputable contractor down the street that has been in business for years.
6. Make Sure You Get a Written Contract
Whether you are doing a complete overhaul of your investment property, or a simple electrical rewire, it is never a good idea to let a contractor perform work on your property without a written contract in place.
The contract that both you and the contractor sign should include details such as:
- Every step of the project from start to finish
- Price and payment schedule
- A start and projected end date
- Whether subcontractors will be hired to perform the work
- Specific materials to be used with associated costs
- Lien releases from all subcontractors and suppliers, should the contractor not pay for labor and materials
- Any changes or additions made along the way
Altogether, a written contract is designed to protect both parties from any misunderstandings when it comes to the physical work being performed on your property, and any price agreements.
With a written contract in place, it is easier to enforce a provision than with a verbal agreement.
This is especially true should a dispute become so serious it lands in court.
7. Use a Property Management Company
For those that don’t want to deal with the time and effort it takes to hire a trustworthy contractor, it is often helpful to employ a reputable property management company instead.
A good property management team will have a reliable group of contractors they work with regularly that provide quality work, professional attitudes, and affordable prices.
You will also reap all of the other benefits that come with hiring a property manager to take care of your rental property such as rent collection, routine inspections, vacancy advertisements, and legally compliant lease drafting.
In the end, there are likely to be times when you need to hire a contractor to help you with your rental property.
Whether you want to remodel the kitchen, fix the shoddy wiring, or simply landscape the backyard to increase the value of your property, chances are you will not be able to do all the work yourself.
Hiring a contractor you can trust is not difficult, so long as you put some time and thought into your final decision.
Never let a contractor pressure you to make a quick decision, add on unnecessary additional work, or let their failure to provide licensure slide.
Your investment property, and rental property business, rely on your ability to weed out the bad contractors and hire only the best.