By Iris Veneracion
Hello WREN community and WREN members this is Iris Veneracion reporting from the field. I’ve been on the road at home from a property and want to share with you five tips for better flips!
Tip #1 – I want you to understand the contractor trifecta. Imagine a triangle and on the top of the triangle I want you to write down “good” and on the side of the triangle I want you to write down “fast” and on the other corner of the triangle I want you to write down “cheap.” I call this the contractor trifecta, what you’ll typically find is you get two out of the three. Not that you couldn’t find all three qualities in a good contractor, but just know, that most likely get two out of the three. For example if a contractor is good and fast, I can tell you this, they probably won’t be that cheap. If they’re fast and cheap they probably won’t good. And, if they’re cheap and good, they won’t be that fast. You guys get the picture.
Now if you do find someone who does have all three qualities, hire them! Keep them happy, give them lots of work, and then refer them to me! That’s the contractor trifecta. As long as you have a general understanding it’ll help you choose your contractors wisely.
Tip #2 – This is especially for people that are just starting out. Maybe you don’t have an established team, or maybe you’re looking to find contractors in an unfamiliar area. What I do is have “bid day.” I want to make sure that I have several contractors come out and bid the same job. My general rule is to get at least three bids.
So for example, if you need all the electrical rewired in a house, make sure you get three electricians to come out and give you bids. Now if you’re a little more experienced, I for example when have the opportunity to do this know it’s really critical that you I just want to say For those of you that are more experienced, I’ll share with you the saying “dumb gets paid.” I know it’s really easy for someone who’s experienced to meet with contractors and tell them what you need and how to do it. Here’s what I learned, shut up, and let the contractors provide me solutions. Let them give their opinion of what needs to be done, why, and have them create solutions. It’s always good to listen up and hear what they have to say and I learned so much about all the different trades just by being quiet and listening and for their suggestions and their solutions.
Back to my tip, get at least three bids, more is even better. What I find is your first bid will be in right field, your next bid is going to be in left field, and then the third bid will help determine where it really needs to be. On a side note, I just want to mention that Idon’t always necessarily go with the least expensive bid. What also important is timing, can I communicate with that contractor, do they have the best ideas, did they create the best solution. I don’t necessarily go for the cheapest bid every single time. I have to see what works for the situation
Tip#3 – Always asked for referrals. You are part of this awesome real estate community so f you’re going into the business of fixing and flipping you know ask around. Ask for referrals for different trades, tile guys drywall people. I find that referrals tend to be the most reliable. If someone has past experience with them it’s always a better gauge to their work. And ask for referrals from the contractors themselves. I have found really great people in different trades from asking the actual contractors that come and work on my property. Believe it or not, they work on other stuff, not just my houses and so they meet people on their job sites. They can be an awesome source of referrals for different trades.
Always ask for referrals from either your community, other flippers and even from your contractors you can ask for referrals from different trades.
Tip#4 – Keep a deal journal. As you go through your journey fixing and flipping houses you’re gonna experience all kinds of things. Each house is unique and they have unique problems and even more unique solutions. I learn something from every house that we do, so whenever I finish a deal, or even during the deal, I like to keep a deal journal. This has been very enlightening, I write down problems I ran into and how they were solved just to keep them in my memory, because trust me after you’ve done ten twenty thirty a hundred houses you’re not going to remember the things that you did early on. So, keep a deal journal and at the end of each project.
Tip#5 – The last thing do the right thing work in integrity. Do the right thing. I can’t emphasize this enough. When you’re flipping and you’re on tight budgets there is a tendency for people to take shortcuts or just cover up something because it may be too much to fix. What I’ve learned throughout the years that it is more important to play in integrity. Do what’s right, when no one’s looking, to make sure that the product that you’re delivering is a good product and the family that’s going to be living there once, you sell it retail, have many years of memories in your new home. Do the right thing!
So that’s my 5 tips for better flips and of course, my favorite saying,
Have fun and make money!
About the author:
Iris Veneracion is the founder of InvestClub, a dynamic real estate communityin SoCal. And the co-organizer of WREN Orange County.
Iris is a full-time investor specializing in fix-n-flips as well as buy-n-holds. She likes to flip for the lifestyle and hold for the freedom. As of late, she has been utilizing the short-term vacation rental platform to double (and sometimes triple) her market rents to supersize cash flows.
Iris believes in the “Power of Partnerships”, relies on the resources of great relationships and stands behind the benefits of being part of an active real estate community. She is the creator of “The 60-Day Challenge” – a unique hands-on, butt kicking real estate “extreme” experience available to local investors.
InvestClub meets the 3rd Wednesday of the month in Fullerton. Please check
out www.REInvestClub.com for more information.