By Gary Massari & Ginger Crystal Faith,
Owners of REI Homes – Signature Properties
We know this is a demanding market for skilled labor and prices are soaring, so how can you possibly curb this? The good news is you can! But it takes time and skills to do it.
Both Ginger and myself spent a lot of money with Fortune Builders Training to learn these techniques, and they seem pretty simple, but they are very effective when it comes to getting bids on your flip.
Tip #1 Learn where to find contractors and subcontractors. We start with Home Advisors and Angie’s list, and here is why…we find a lot of highly skilled workers who just got their contractors license and are now starting their own business. They are looking for long term clients and willing to meet your budget to get going! Also they really care about their ratings and do excellent work for us.
Tip #2 Contractors lead to other contractors and subcontractors. When we interview our contractors we simply ask them whom they would recommend for a plumber, electrician, and so forth. Your labor pool will start building and fast! This is great way to build multiple crews for other projects.
Tip #3 Tell them about your company and goals. When they hear about your company and goals to expand your business they get excited to work with you and will cut their prices to get going with you!
Here is the script we use…Listen, we are growing our company very quickly and would like to add three additional homes this year. We are looking for long-term relationships and because we build several homes at the same time we need a fairly large contractors pool. We are looking for wholesale prices and not retail, and in exchange we thrive to keep you busy from one job to another. Is this a relationship you are looking for? (They always smile and say yes)
Tip #4 Explain the rules. Because we work with private money investors who make better than market returns our cost of money is expensive, therefore time is of the essence. We expect you to arrive on time and take normal lunch (30 min.) and breaks (15 min.) not exceeding one hour in total. Because we work with investors who constantly visit our jobs we need our work place cleaned at the end of the day. Radios are not allowed as a lot of kids our studying at home, and we do not want complaints. There is no arguing on the job, all disputes are discussed with our Contractor. Smoking is not allowed on job site. All COVID 19 rules apply.
Tip #5 We pay bonuses and charge penalties. We give our contractors and subcontractors an opportunity to make a bonus when they beat their schedule. We advise them to give us an estimate of time and add a 10% contingency to their time. This is written in their contract. This works so well, because they work so hard to meet their deadlines in order to make their bonuses. If they are late barring no rain, or inspection delays we charge them a daily late penalty at the same rate we set their bonuses. Again both are stated in the contract, and they love it. You can set your bonus and penalty rate at any rate you want, we use our daily cost of money, which is our interest cost.
About Gary Massari & Ginger Crystal Faith
Gary & Ginger are top real estate investors and educators running a very popular real estate investment club called “Make Money Now” where people connect with deals and financing and have a whole lot of fun. What very few people know is Gary and Ginger are both real estate brokers and builders. They own a highly successful multi-million dollar luxury home construction company in San Francisco Bay Area, and work in partnership with other investors for very high returns from their projects. “One of the greatest rewards is being able to invest personally along with our partners to achieve higher than any market returns”, says Ginger! “We belong to several wine clubs in Napa Valley and enjoy outings with our partners, it is so much fun!”
“We would love to meet you and possibly help you to qualify as one of our investors, it is easier than you think,” Gary! We offer a free Q&A or get to know us sessions. You can make an appointment on our website at https://reifortunes.com anytime!
Every week we put out educational fun information about real estate investing and paying off your mortgage using velocity banking, our goal is to show you how to become financially independent by investing and owning real estate debt free…
Please take a look at our:
YouTube channel: https://www.youtube.com/channel/UCFarJmAvzq_NWq4wAK7StCg
Podcast channel: https://www.buzzsprout.com/1757320/episodes