Guys,
As i explained at the end of last class, we need to schedule some contractors to come out and check out 75 Arlington, but before we do that you need to call some guys and talk with them on what some of their prices are like. We dont need to waste our time with someone who is trying to give us retail pricces.
You need to let these contractors know in your conversation that you and your partners do a decent amount of rehabs and we are looking for another crew to bring on the team as we have a few more deals than our current team can handle at one time. You need to state it in a way where it doesnt seem like you are bragging/boasting but in a way where you say it and then move on. Feel free to say you and your partners recently did one in elizabeth (511 E Jersey) 2 in Jersey City (32 Mill road and 182 Mcadoo--we are finishing up now) 2 in Newark (20 Stuyvesant and 97 Oraton -- which we are not done with and is on hold for a couple more weeks). I wouldnt say the addresses unless they ask, but i would say something like this real fast...yeah in like the last 6 months we completed 2 in Newark, 1 in elizabeth and 1 pending, 2 in Jersey city and we have 2 more we are taking down. One of them is why i am calling you today about.
With that being said, you need to find crews NOW. Easy but more effort is craigslist in the services offered section. Search each listing unitl u find one that you like. Another way is to post on websites for referrals of a contractor another rehabber/investor has used. Comes with credibility but harder as not all people want to share their crews. Another is driving around and looking for the guys with not a beat up half broken down truck nor a brand new shiny one. This middle of the road guys tend to be more reasonable (not always, just more likely).
At some time in your conversation, make sure to find out if they are licensed and insured and what kind of inurance they have. Is it General liability or do they also carry Workmans Comp?
Rough scope of work that can be conveyed to them over the phone is something like this...This is what we are looking at: Its a 2 family that has paneling on all walls. We checked and the walls for the most part seem good. We would remove paneling and skim coat what we can and fix the rest. We are doing new flooring, some carpet, some tile and some pergo. We have 2 "rental" kitchens and 2 baths...standard 5x7 baths. We are going to have to do some new electric runs as we have non grounded old BX wires. Alot of paint, doors, some trim work, light fixtures, outlets and switches and a new roof. You know, normal rehabby stuff. 95% of the roof is flat roof with a hole in it, so we need to do some CDX plywood patching then install a new one.
From there you want to have a conversation with them to get some rough prices...Ask them what a typical bathroom would cost for a rental grade being a 5x7. If they say well i have to see it...say, well its a 5x7 and it would be a complete remove and replace, and i know the material cost will range from 1100-1300 and thats assuming you just make it easy andd go to Home Depot and pay their prices...Look, I am sure you have done more than you can remember of these, but i know you should also have a rough idea what we are looking at. The reason i ask, is that i want to respect your time and i dont want you to come out if we are far off from each other in prices. Remember, in the last 6 months alone we have done 6 rehabs, so we are a 1 per month rehab team. We cant afford to pay homeowner retail prices when we are providing our crew with quantity. So i am just trying to see if we may possibly be a fit for each other. So in this case, a standard 5x7 remove and replace bathroom is usually the same cost across the board for us...so what kind of range are we talking about here...Then be quiet.
From there, react as you choose, cuz in the end this is practice and you are on the phone. Shoot for 4k, and if they are close, say, well thats not where my other crews are doing them at, but you arent that far off. If you want to come out and we can talk about where we need to be at, maybe we can make something happen. But i need this to be done this Saturday, because we are closing probably in two weeks and if we are going to use a new crew, i need to know asap. From there my partners are particular on these jobs, so we would then need to make a time where we can come check out a job you are currently on and possibly a job you just finished. This way we can peice together whats expected and if we have any questions we can address them now.
If this is something that you think you can handle and are up to, we can set up a meeting time. Is this something we should move forward on and set a date or do you not have time right now? I would give them an easy way out so its not awkward, cuz if they need the way out they werent the crew for u anyway.
Ok, this part is on you guys now. YOU need to be proactive and do what you can to find some prospects. In the end, these may be crews that you may use on one of your rehabs, so theres no better place to start than a live deal I am about to start on.
Use craigslist, backpage, and search for some online forums focusing in on others who rehab in NJ. Approcahing someone at Home depot wouldnt be bad for practice. When done, think about the conversation you just had and what u think you did right or wrong and what you should change. If on the phone, take notes. This will help you as you move forward. Its like in any business, the more you do it, the better you become and before you know it, its like second nature to you and once you have that confidence, you will rapidly succeed.
Please use the site to ask questions if you are stuck or need some help. Also, look at the docs i uploaded as there is the contractor interview sheet there.
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heys guys its mike, just wanted to let you know I potentaly have contractor coming out this sat between 11 and 12 so try not to book contractor you find around this time. Just waiting for callback tomorrow to finalize.