Let’s get one thing straight, this isn’t TV. TV is staged and always makes a profit, buyer’s are found, and all obstacles are cleared up in an hour… not reality!
So, now that we have that out of the way, if you’re not a risk taker, close this right now and walk away. The risks are huge and so are the payoff’s if everything goes right. No matter how many “flips” you do, nothing is routine.
So, let’s begin. The first thing every rehabber should do is build a team. Too many rookies will try to get a deal and then scramble to find the contractor, the agent, the lender… time is ticking and you’re losing valuable time doing what you should’ve done months ago.
How do I find Agents? I found mine online. I typed in a town I was interested in, zillow gives 3 possible agents to choose from. I looked at reviews, number of sales in last 12 months and called them to meet. The first broker I meet knows several rehabbers but they only do one home at a time. I introduce myself as someone who wants to do 15-20 per year.
The first promise I make, and you should too, is promise to use the same Agent who finds the property for you and the one who sells it when you’re done. It makes them work harder for you and pay attention… heck, in fact, they’ll even look for properties for you. Spend the next few weeks watching who sends you properties and who doesn’t… the who does are on your team.
Now let’s find Contractors. This steps requires a little more time and creativity. First, run an ad on Craigslist, facebook, twitter, etc and be specific as to what you’re looking for. A contractor who can do a total rehab in 6-8 weeks using quality products, can warranty for at least a year, and has a license, workman comp insurance, etc. We use “6 Critical Documents for Every Contractor”. Simply 6 docs we demand and obtain before anyone gets hired.
Everybody usually knows an Attorney and an Insurance guy. That part is easier to start off and critique as you grow. Not everybody on your team today can handle the work load of where you hope to be in a year or two. Growing any company requires hiring the guy who can handle tomorrow’s work, not yesterdays. Remember Wayne Gretzky’s famous line. “I skate to where the puck is going, not where is puck is now”.
Now build marketing, buyer’s lists and network your butt off. I’ll cover this more later but getting people to know you is vital to success later. Remember, you’ll meet the same people on your way up that you do on the way down… Regardless of what your ego is telling you, don’t make enemies. You may need that person at some point. Never be an island!
To be continued… you’ve got enough to get started here.