Choosing a contractor for your house-flipping business requires looking at more than their rates. By just going with the cheapest option, you often run the risk of shoddy work - which leads to more money spent down the road and can often damage your reputation as a seller and business owner. But someone who charges top dollar doesn’t automatically mean that they are the best, either.
It’s an important decision and one that can often mean the difference between success or failure. Here are six tips for playing it smart in the contractor search.
1. Educate yourself.
To get what you want, you have to be able to articulate it to someone who matters. This is true in many aspects of life, and it’s true in the contractor search as well. If you’re new to the industry, it’s especially important to familiarize yourself with things like home improvement requirements, terminology, regulations, etc., so that you can understand the conversations that are about to take place. Developing a solid understanding is also a key self-protective measure, as it will prevent dishonest contractors from potentially trying to take advantage of you.
Make sure you know what you want before you even talk to contractors. Your estimates will be more accurate if you’re specific and clear about the work you want to be done, how you want it to look, and what kind of materials you want them to use.
2. Get recommendations from people you trust.
Ask your friends, family, and coworkers for contractor references. Talk to people in the neighborhood who have had similar work done to their houses. If none of these options yield good results, hardware store or lumberyard employees may also have some good referrals, as they see contractors on a regular basis and know which ones keep up with their bills, which ones purchase high-quality materials, etc.
3. Interview several contractors.
A good minimum is three. Ask lots of questions, get clarifications, and obtain a bid in writing from each one. Be sure to request the same materials and tasks of each one, so the bids are accurately comparable. The right person should be easy for you to talk to and able to answer your questions satisfactorily. It’s critical that you and the contractor you choose can communicate well, because he or she will be spending many hours in your home. Be willing and prepared to negotiate, though most of this happens after the bid and before signing the contract.
4. Understand a contractor’s qualifications.
Learn what those credentials behind your contractor’s name mean. Usually, they are certifications from various national trade organizations, meaning they belong to organizations that bind them to a strict code of ethics. Some of these abbreviations might include certified aging in place specialist (CAPS), certified graduate remodeler (CGR), local Building Industry Association member (BIA), and National Association of Home Builders (NAHB). One thing you should insist on is a licensed, bonded, and insured contractor. Simply put, this generally means that you, as the homeowner, will not be liable if a crewmember gets hurt on the job.
5. Obtain proper permits.
Almost all home renovation jobs require permits, and you should always get them. If a contractor suggests you complete a project without permits to save money, this should be a major red flag. Unpermitted work can cause issues when it’s time to sell, as it means the work won’t be inspected to make sure it’s up to code, and you will be fined if you’re caught.
6. Make sure everything is 100% done before signing off on it.
Meet with your contractor and note any unfinished tasks. Arrange a final walkthrough to check things out yourself. Contractors will sometimes complete most of a job and then move on to something else without finishing the final details of the first thing. Don’t sign that final check until you are totally satisfied with the work, and keep all receipts and lien releases.
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