Plan Your Rehab Schedule
For real estate investors, home flipping continues to be a popular form of investing. According to an article from the Mortgage Bankers Association, house flipping continues to grow even during an eleven-year high. Taking a distressed property and renovating it into a beautiful home not only improves communities but is also a great way for investors to earn additional income. Since you will be making repairs to the home it’s important that you understand how to plan the rehab schedule. There are several different factors that go into completing a rehab project and you’ll need to have a solid schedule in place to help the rehab process be as smooth as possible.
Below are three tips to get you started planning an efficient rehab schedule. These three tips offer insight into how to plan a rehab schedule and the best practices to complete your rehab to ensure a high return on investment on your property.
1) Hire a reputable contractor
One of the first things you’ll need to do is hire a contractor. Unless you plan to do all of the work by yourself, you’ll need to hire a contractor to assist and manage the rehab. Finding the right contractor is critical because you don’t want to continuously cycle through contractors, as this will only slow down your project and eat away at your profits. To ensure that you’re hiring a reputable contractor, you will need to get references from previous clients who can attest to the overall quality of the work and if there were any red flags. Once you have found the right contractor, they will be able to give you an estimate of costs and give you a strong sense of how the rehab will be laid out in the most streamlined way.
2) Create a schedule for each stage
As you move toward beginning work on your fix-and-flip project, you’ll need to make sure that you have a schedule for each stage. For instance, if the first thing you plan to do is cleaning up around the property, make sure that you schedule ahead of time and have a set deadline for the completion of the clean-up. After the clean-up is finished, within the allotted time on the schedule, you can move onto the next stage of your rehab. Now take painting the home for example, if it takes a week to paint the house, you’ll most likely need to schedule for a week and a half to account for delays. You can continue this process for each stage of the rehab and make tweaks as the rehab starts to take shape.
Completing the schedule for each of these stages is something a quality contractor can help you prepare for. They will have a good understanding of how long it takes to finish each stage of the rehab, and the order in which you should create your schedule.
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3) Order materials in advance
Another way to keep your schedule tight is to have the materials you’ll need ordered in advance. Having your paint schemes, materials, and appliances chosen and ordered allows you to make a smooth transition between each stage of the rehab. If you’re ordering granite counter tops and it will take a month to have it delivered, you’ll need to make sure that you line up the arrival time with that stage of the rehab; this way you can avoid having the house sitting for an extended period while you wait for your materials. The faster you’re able to complete each stage without extended downtime, the faster you’ll be able to flip the house and increase your overall profits.
Accurately planning your rehab goes a long way towards a successful fix-and-flip investment. Having a good understanding of what to expect from your contractor and knowing how the project will flow from stage to stage greatly increases your chances for success, and helps you hedge any unforeseen issues that may arise over the course of the project. As you look to move forward on your next fix-and-flip project, utilizing these three tips can put you on the right path and help you effectively manage your project.