It's no surprise house flipping is an expensive and time-consuming project. One of the most important steps in the process is choosing the right contractor for the gig. They'll oversee much of the work and make sure it's all done to code, which can truly make or break your project. So, of course, you want to choose wisely.
But if it's your first time flipping, you might not know how to discern which contractors are ready for the job, and which might not suit your project and your working style. Take on these six tips for vetting your future contractor so your flip goes off without a hitch — or, with as few speedbumps as possible.
- Select a General or Sub Contractor
What's your managerial style? Knowing this can help you find the right contractor. For some house flippers, they prefer a more hands-on approach in their oversight of a particular project. So, they hire sub-contractors to handle different tasks in the flip, and they take charge of the timeline. If you prefer this kind of approach, then write out a list of the projects you want to complete, and find a sub-contractor who can tackle each one.
Or, perhaps you prefer to be hands-off when it comes to your flipping. A general contractor can step in and take the reins, so to speak. They'll make sure everything's done well, properly and on time. If you plan to flip while maintaining another job, for example, then hiring a general contractor might be your better option.
- Rely on References
One of the best ways to know you're working with someone legitimate is to hear from others who have worked with them, too. You might have a friend or acquaintance who does house flipping — they'll certainly have a recommendation of who to hire as a contractor. Or, you can use online databases and review sites to find someone with a good reputation. On the site Angieslist.com, for instance, staffers make sure reviews are authentic so you get a clear picture of the contractor you're hiring before you hire them.
- Narrow Down the Field
Don't settle on a single candidate right away. Instead, you should play the field a bit and reach out to the contractors who have caught your eye. Most people will settle on three top candidates and have them into the property for a look at the project. Then, the contractors will name their price and what they think the project will cost with their services included.
Beware of a contractor who comes in with a bid that's significantly lower than the others. In most cases, choosing the cheapest bid won't save you money. It will just mean you get subpar work, and you'll probably have to bring in another professional to complete the job. Instead, select the contractor whose bid carefully lists materials, labor and service fees while remaining economical.
- Ensure They're Insured
Another must-have for contractors is insurance. Think of it this way — you make a huge investment in your flip property. You want to make sure the person you pay to do the job can do so safely and within the law. Insurance will cover both of you in case of a mistake or an emergency, so it's imperative that whoever you hire has such coverage.
- Interview Like a Pro
As previously mentioned, finding the perfect contractor isn't just about the bid they make. When you meet with your potential candidates, you should treat the session like an interview. If the person shows up late, for instance, you know they might not be a reliable person to have at the helm of a tightly scheduled flip. Ask the right questions to gauge their experience, expertise and confidence. In the end, you should go with your gut instinct and choose the contractor with whom you feel most comfortable.
- Verify If You Need Permits
If you want one more way to prove your contractor is a legitimate, knowledgeable hire, then find out if you need permits for the projects you intend to complete. Then, ask your potential contractor the same question. If they say yes, then they know what they're doing. If they say no, then they may be the type of person to skirt the rules in order to make the job cheaper and quicker. Although this may sound tempting to you, too, you can't hire someone who won't do the job right and in line with the law. Otherwise, you could lose much of your flip investment doing and redoing the same projects.
Flipping a House With Some Professional Help
In the end, it'll be up to you and your instincts to decide who the best contractor for the job is. However, if you ask the right questions, know what you need and choose someone who's insured and smart, then you'll have no trouble choosing the right person. After that, you can rest easy knowing you made an investment in your flip, and that it will go well with a handy contractor at the helm.
Holly Welles is a real estate writer covering property management, investment and the rental market. She’s the editor of her own blog, The Estate Update, and posts more industry writing on Twitter @HollyAWelles.