Many new investors are costing themselves extra money while they think they are saving money and they don't even know it. It is a common mistake and it is made honestly by the jack of all trades handy man bent on doing it all himself.
While it is very valuable to have knowledge of how things should be done and even be able to do the job yourself. It may not always be wise to spend the time and effort to do the work yourself. Especially if you run into complications, or if you should be concentrating more on finding the next property to buy, or finding a buyer or tenant for the house you just completed.
The value of having good experienced trade contractors who you can count on to respond quickly, who will work with you on price and terms (especially terms) because you use them regularly should not be underestimated.
It is not uncommon to find that you can not only get a job done more quickly but at a better price than you can do it yourself by having a team in place. Some examples are:
• Heat and Air Conditioning - If this one is honest and dependable plus willing to price according to the volume you will deliver you can't afford to be without him. New HVAC is a big selling point and if you wind up keeping the house as a rental you will appreciate the energy savings and low maintenance cost.
• Window companies - I get windows installed and trimmed for only about $50 more than I have to pay for an inferior window alone at the big box.
• Plumbing - The savings of time alone going back and forth for supplies can more than pay the cost of your plumber. Plus having a relationship that will get you put on top of the pile in emergency is invaluable.
• Insurance Company - No matter if you are renting or reselling the finished product you will need property insurance. Once again quick response and a good price are important but even more so is an agent you can count on to service your questions and concerns as well as work with you when a dispute with your lender arises.
• An attorney who is familiar with your real estate investment business should not be overlooked.
• Do you have an accountant in place who will take advantage of the many opportunities that owning Real Estate can provide? If not you need to look into it right away.
The above list can go on and on but you should have the idea.
Don't forget to set up your supplier accounts and have your authorized buyers designated. If you don't want to be a gopher (Go - For) you should have these set up for things like paint, tools, hardware, and the like.
Russ Crouch is a Realtor and Real Estate investor with experience in Real Estate beginning in 1977.
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