All Forum Posts by: Michael Ablan

@Shane H.  -  That's solid input Shane, thank you.  

These are the details that can make or break a mediocre airbnb vs high performer, especially during the off-market times.   

One booking pays for a brand new set.   So why not include them?

My personal machine issues has been tied to the water source.  Two of my properties have pumped their water from the lake.  Our filters would clog even w/ badass water filters.   These clogged filter problems always arose in washing machines.  And on the dryer side, people would take a family of 10's soaking wet clothes and throw them in the dryer....all at once.....and break it..

Eventually enough is enough.   But again, some things are worth it when you factor things out

@Ryan McCullough  40 at start, 40 at a certain point near the end, 10 at the cleanup/touchup phase 

@Kyle Grimm - I just transfer the questions over to a google sheet file and fill it out in there (and then submit as an attachment w/ their main file)   Then you have it forever and can just update it when you need to submit it again

@Ryan McCullough -  How big is the job?

You can get as simple, or as complicated as possible.

I wouldn't recommend 50/50.   40/40/10 is better.  There's always a struggle to get the last little bit of a project wrapped up.

Or you could phase out the job (3-5 phases) and pay a % of the job per completed, signed off phase

@Brady Lawson -  It can go either way.   If you have a desirable place, in a good location then it won't matter.  

I personally hate including them because they're just another potential service call, but people do enjoy having them

@Jay Hinrichs -  Hahaha,...hunting season.  We try to use November 1st as our deadline for projects in anticipation for this.  

You're spot on though.  It's a non negotiable for a lot of our guys.   In their defense, it's usually the only vacation they take all year, but we have some who go ghost for 30-45 days (or more if they're hunting Southern Tier).

I've teased the idea of using a "all expense paid hunting trip" as a reward/bonus for exceptional service throughout the year (based on hitting KPI's for timeline, budget, and quality), but that opens up it's own can of worms.

Our best defense to date has been pushing hard in Sep/Oct to finish jobs or pass critical milestones.  Then just use the Nov/Dec months to experiment w/ new subs on smaller projects

@James Wise - Construction is an insanely difficult business/line of work.  I know this because we started our own construction company because of the unreliability of companies we'd hire for our projects.   I give high level construction company operators a ton of credit for pulling it off.  It's mind-blowing how difficult it is...and here's a couple reasons why

1.)  You're pulling from a work force of highly volatile people, who're tasked w/ doing an extremely physically and mentally draining job (in whatever weather mother nature provides for the day).  They're also usually not tech savvy.

One day you have the hardest working crew that's ever been assembled.  But then the next day those same people are making stupid mistakes (if they're even showing up at all).   

It's a revolving door business, which is incredibly difficult to manage without the proper systems/admin staff (which 95% of them don't have).

2.) Construction is incredibly complicated. There's 10+ different trades and they all require a different set of skills and they all attract a particular type of person.  Pair that w/ drug & alcohol abuse....well, I don't need to say much more.

On top of that, you're dealing w/ code/permits, city policies, material delays/shortages, labor shortages, change orders, the weather, ect.   This is a highly complex business that's normally run by guys who were able to get really good at a bunch of the trades.  The better ones have some leadership attributes... but there's so much more to this than that.

3.) I don't think people understand how much time goes into properly evaluating a home and putting together a solid quote for work.  On top of that, most people know nothing about construction.  So when they get a quote, they usually say "a tile shower costs WHAT?!  No thanks, maybe next year...."   Or they agree to it and then change their mind when the idea starts coming into reality....

We get a ridiculous amount of people asking for us to come "give us a quote."  We would need to pay a full time salary of $50-$75k for a proper takeoff estimator.  I can tell you one thing...most investors don't have deals w/ enough meat on the bones to pay for a contractor capable of staffing a solid takeoff estimator.   That means it's usually the owner/foreman doing it (whose also needed to work on the jobs/answer their phone/go on more job estimates).   

Overworked & over-extended = poor quality of work, missed timelines, and way off budget

I could keep doing, but you get my point.   Construction is hard AF and requires a significant amount of time and resources to do well.   "Investors" who kick tires aren't at the bottom of the barrel...They aren't even allowed in it.

My advice is this.   If you can get in with someone competent, then treat them like GOLD and let the small crap slide.  Pay them on time.  Don't do change orders unless ABSOLUTELY necessary.  Be extremely clear w/ your expectations upfront and have an  solid plan put together before you even pick up the phone.  

As investors, it's your job to have the vision and end result planned out and put together.  Do NOT rely on them to do it for you...you'll only be disappointed   

@Greg Todrank  - Find a badass GC and give them a piece of the deal to work w/ you on this.   You'll dramatically improve your chances for success if you have a GC invested in the projects overall success

You'll also want to get a good realtor who can advise on whats popular in your market for finishes, color schemes, ect  

Last but not least, find a great home stager and stage the home prior to selling.  People buy based on feelings and staging generates those for people

@Aaron Delavega - This was how I got my start.   It was pretty dangerous, but it worked.  The trick to remember here is, you MUST pay back that card before the 18 months expire or you'll get slammed w/ all the back interest

This method worked for me because I was BRRRing the properties and doing a lot of the labor w/ my father and myself.  Just make sure you can qualify for the financing on the back end

Good luck!

@James Wise - Great post!  Thank you for making it!

I will put it on the record right now that I do not work w/ investors for this very reason.   Too much time goes into these properties for the possible payday and 95% of "investors" end up being tire kickers.  Nothing is more frustrating to me than someone who either can't pull the trigger, or gets cold feet halfway through a deal and backs out.

It's interesting to hear that you require an upfront payment prior to working with them.   I like that idea.  

Do you have any contract laid out that sets the minimum expectations for both you and the client?   Essentially something that states that they're required to pull the trigger on a deal if it meets the criteria they established in the beginning?