It’s impossible to have a thriving career as a real estate investment professional without adopting the ability to find the right contractors. Whether you’re more apt to need a handyman or a general contractor in your daily operations, finding the right person or team for the job should always be a top business priority.
Even in the most ideal of circumstances, contractors will be one of your most frequent hires. Considering the right contractor can be your ticket to higher satisfaction and higher profits, identifying best prospects consistently is an essential skill.
Always Be Looking
Many real estate investment professionals only look for new service providers and contractors when there is an immediate need in their business. This can lead to a myriad of problems if there are any snags in the selection process. Unnecessary project delays and excessive downtime are only two of the potential outcomes of an inconsistent approach to contractor recruitment.
Because the quality and reliability of your contractors is such a key to your success, you’ll always want to maintain a database of back up contractors, even when your current needs are satisfied.
It’s often thought that checking references is a waste of time. “Who would give the name of anyone who would give a bad report?” is the oft-repeated
question that precedes the thought “I can’t really learn anything useful from a cherry-picked reference.”
But you can learn a lot. And it is worth checking references for each and every potential contractor that you’re considering hiring. Even if you’re sure the guy was legit and a good egg, some of the most conniving characters are the most charming. If you haven’t used any given contractor before, check references before you sign the contract and/or pay the deposit.
It’s the step of the process that is most often skipped when you hear of things going wrong with a contractor relationship.
For one thing, you may be surprised at how many contractors will provide names of dissatisfied former clients as references. Whether it’s because they’re sure you won’t double check or because they aren’t aware of the issues, or because the former client is more open to overlooking details that you won’t – like licensing, worker’s compensation, liability insurance and acquiring the proper permits for work.
If you don’t check, you won’t know. And that could cost you.
Hire on Value, Not Price
There’s nothing wrong with keeping a keen eye on expenses to increase your profitability, but it can be hazardous to your financial health to focus on frugality at the expense of other considerations. In other words, beware of being penny wise and pound foolish.
Make sure all bids and estimates are based on the same scope of work before you evaluate the pricing. Estimates that come in way under par can be a red flag for substandard work or heinous overcharges, while an out of the ballpark high estimate may uncover a core obstacle that the others didn’t accommodate for.
It’s important to realize that you may have to pay a little more to get the quality that makes for good business. You may have to pay a slight premium for reliability and availability. Rock bottom pricing that doesn’t move at the speed you need is hardly a bargain if it costs you more in the long run.
Your goal should be to decrease costs, not cut corners. There is a distinct difference and quality contractors will help you discern the difference as you build your real estate investment business.