With the many benefits the real estate industry offers when applying the best real estate investment strategies, many property owners and real estate investors remodel or renovate their real estate investments to generate more income.
How can investors find the right contractor for their real estate investing team? Ideally, you want to find one who will do it right the first time at an affordable price! An excellent way to ensure that you’re working with the best contractor is by asking some questions before hiring them. As part of our real estate investing 101 tips for investors, here are some questions to ask when looking for the right contractor.
How Many People Work on Your Crew?
Start by asking a potential contractor about their team and how long the team has worked together. Suppose they have a constantly revolving door of people coming and going. This could indicate that your project might face setbacks because your vendor can’t hang on to good workers throughout a project.
Look for contractors with a reliable and punctual crew that can take care of the job while providing outstanding service.
How Long Have You Managed Your Own Team?
Many independent contractors started working for other companies before starting their own. If you've decided to hire a contractor, it's essential to ask about their qualifications as a project leader and how long they’ve managed their own team.
This helps real estate investors evaluate if a contractor has the right experience and trust in their workers to get the job done right.
Are They Licensed to Do This Work?
Before signing on with a contractor, make sure they're licensed to perform work in your area. If not, you could be liable for injured workers if something goes wrong during the project. You also risk working with a vendor that doesn’t have the skills or qualifications you need to conduct successful renovations in line with your real estate investing strategies.
A real estate investor can look online to see if a contractor has the proper license and insurance.
Will Subcontractors Be Used?
Contractors should ideally take care of the project independently or with their team. However, contractors sometimes need to use subcontractors to help with certain aspects of the project.
If your contractor hires subcontractors, make sure that they're reputable, trustworthy, and licensed. Also make sure that when a contractor brings in a subcontractor that they still work within your agreed upon budget.
Have They Ever Been Sued or Dealt With Lawsuit?
It's essential to ask this question as it could be one of the many red flags for potential problems with a contractor. If they have been sued by a worker or client, follow up and ask how the contractor resolved it. It's not an immediate reason to take the contractor out of consideration, but you'll want to dig a little deeper if they answered yes to this question.
It's also important to do your research on contractors before hiring them and check public records and online rreviews. This includes finding out if they've had any serious accidents that caused hospitalizations or injuries.
How Are Job Sites Kept Clean and Safe?
A clean site is essential for safety and a successful project. If your contractor does not have a safe work environment, they may be exposing themselves (and you) to risk. Ask about how they keep their jobsite clean and safe. If there are no precautions taken, the contractor could be a risky addition to your real estate investing team.
How Many Clients Do You Have?
The best contractors often have a heavy workload. Be sure that they don’t have so many clients that you’ll never make it on their calendar to start and finish projects!
The benefit of partnering with a contractor on an ongoing basis is having a professional ready to get to work when it’s time for rental property renovations or your next house flip. Ask about their turnaround time for projects, and how many projects they can take on during the year.
It's also important to be aware that many contractors work on multiple projects simultaneously. Ask a contractor how they staff multiple projects and ensure consistent quality work when working on multiple homes at the same time.
What Is Their Payment Process?
Before working with a contractor, clarify the business relationship, including the invoicing and payment process. This means that you and your contractor must agree on the upfront deposit amount, payment schedules, and the overall scope of work that needs to be done.
A good contractor is transparent, has all the necessary documents, and is willing to complete your project within a specific time frame while keeping communication open throughout the process.
Find Your Ideal Investment Property With Privy!
Adding the right contractor to your team is critical for success, but before you can put them to work, you need investment properties! Whether you’re learning how to get started in real estate investing or you’re a seasoned investor, the Privy platform allows investors to find ideal properties in a preferred real estate market.
We offer a unique approach to finding real estate investments, which means you won't have to spend hours searching through listings online! Reach out soon to learn how it works.
Learn more about the professionals you need on your team when downloading our free "Assemble Your Real Estate Investing Team: A Worksheet!”