Around this time of year I think about if getting a new churning/promo type business credit card is worth paying my property taxes with. Applying now is best to have it ready to pay January taxes.

• Chase Ink Business Cash
  • 0% intro APR on purchases for the first 12 months
  • $750 bonus cash back after spending $6,000 (e.g., property taxes) in the first 3 months
  • $0/year
• Capital One Spark Cash
  • $1k cash bonus on $10k spend in 3 months ($2k bonus if $20k spend)
  • Unlimited 2% cash back everywhere
  • $0 first year, then $95/year
• Amex Blue Business Cash
  • 0% intro APR on purchases for the first 12 months
  • 2% cash back on all eligible purchases (up to $50k)
  • $0/year

Amex is better for larger rehabs (instead of using it for property taxes).

Maybe do more travelling in 2027... then I'd pick this one for my taxes:

• Capital One Venture Business
  • 100k miles after $10k/3 months
    • 3 trips to Miami for two
  • $95/year

Any other welcome-bonus credit cards you've used?

REIA meetings are all right. I usually learn small tidbits of info. The networking isn't great. I love discussing REI. There is 30 minutes before and after for mingling.

My largest issues is the cost plus time commitment. I'd much rather do an hour date than listen to someone speak for two hours.

It's similar to church if you're not religious. Yes, some tidbits of things are good. But overall it's really not worth it.

The next meeting is about the infinite banking method. And I'm realizing a lot of the speakers are just selling their business. So I'm paying to be given an indirect sales presentation. (My local REIA is set up so speakers are not supposed to give a hard sell until the last 10% or something of their talk.)

If I hosted a REIA, I would want to limit the presentations to 30-45 minutes. Although, the best one I attended did a deep dive into seller financing--with real case studies. (He really need 2 hours.)

Lastly, I've gotten bad advice and recommendations from the hosts. They had no idea that I'm great at leasing and handling tenants. Yet, out of the blue, they recommended that I hire a PM. Another time I was looking for window installer. They recommended some guy. After I contacted, he gave me a high quote without warranty. I went with a different installer with a warranty.

He's looking to unload a property that has a tax appraised value of about $128k.

He believes the 4-bed unit up top and the commercial space below can rent for $1700/mo. I know it can rent for at least $2000/mo.

He bought it for 75k in 2005. Should I just offer the tax assessed value? Or how should I go about it. He knows I may wholesale it. He seems to prefer I buy it (he likes my character, lol).

• 2500 sqft combined
• rubber roof leak (upper damaged ceiling)
• some medium (not minor or major) plumbing issue
• 1 furnace that heats both units (no separate meter currently)

Current situation

• I used to renovate houses that I bought one after the other. These were mainly rentals and I kept them as rentals (BRRRR method of real estate investing).
• Currently have $113k in cash, mixed business/personal cash. I live below my means at about 25k/year.
• Planning to spend $60k on another property (which will be rented out fairly quickly after minor reno), leaving ~$50k cash leftover
• I have 2 vacant houses of my own to renovate (bought in cash, very little taxes and no other holding costs). I should reserve about 45k for materials costs. Both are at 0% complete rehab (6+ months each).

Coming up

For a different house, refinance (out of cash) that I've nearly completed renovations. Should get back at least 100k. That will come in about 3.5 months.

Property taxes will be due around then. That's about a 15k bite.

For client projects, not my own properties, I'm allowed 50% of the contract price up front. Prefer to actually start work before getting that but I could get that draw whenever:

• Contract #1: $24k project, contracted but work hasn't started yet.
  • 12k is 50% draw
  • 10k gross profit
• Contract #2: $48k same deal
  • 24k is 50% draw
  • 15k gross profit

Most of this work (roofing/siding) is subcontracted out. I planned on doing 1 bathroom remodel + 1/2 bath remodel + door installs and a few other odds and ends.

Hiring situation

• Considering hiring my first full-time employee "Residential Maintenance Technician"
• Expected wage: $30-35/hr
• My estimated total employer cost: $40-45/hr
• My main concern is maintaining enough cash flow and work volume to justify keeping someone employed. Like I mentioned, before I did one house after the other. Back then, there was not any real contract work.

What I'm trying to figure out

• How many months of payroll should I keep in reserve?
• Can I afford to pay a higher wage?
• For construction business owners or flippers, any tips? Any guidance?

I wholesaled a property to another investor. I noticed they painted/coated the basement floor before listing it on the market two months after they bought it. They did other standard renovations. But the basement floor coating stood out to me. They also put new mulch down (which I probably would not have done).

I would have put up two walls to make the 2-bed into a 3-bed. But maybe they didn't do that because of time (to list it before winter) or price.

On competitor's websites they have family photos with like 3-5 kids for each. I'm childfree. I can't compete on "family." What else is there?

Community development? My company does usually get the local block grant projects...

Does anyone stay on site or keep their own employee on site when subbing out roofing/siding?

I'm mainly thinking about lead generation. (Maybe putting a yard sign with my roofing company trade name is good enough.)

I've seen other companies usually have a foreman bring the material and then they disappear until the final inspection.

I'm a contractor myself, but I'm still confused about why other contractors--who don't know that I'm a contractor--ask whether the property is a rental or my primary residence when we meet in person.

This is after they ask if I'm the owner of the property (valid question).

Drain line for bathroom vanity needs to be moved lower. It would be easiest to cut a hole in the cast iron rather than remove a section of it (under the subfloor).

https://www.grainger.com/product/3HDF1

Planning on pairing the 90 degree saddle tee with a long turn PVC elbow.

Experiences hiring carpenters in their 60s?

A lot of the work we do involves lifting tools, buckets, materials. I did briefly hire a petite woman as a general laborer. She quit because it was too much. (She could not lift a sliding glass door with another person.)

And so I wonder about hiring older folks. I clearly state in the job description about being able to lift up to 50 lb.

I'm guessing they'll be fine with day laborer helpers? Your experiences?

• Schedule bonus: $X for finishing by a certain date and not drawing projects out long.
• Customer-satisfaction bonus: $Y if the client approves of the work without major issues. (This determined by client satisfaction survey.)
• Communication bonus: $Z given either one month after project or before next project. (Some I've had issue with texting back, returning calls or replying to email. I try to communicate with what each person/company prefers.)

They could be a percentage of their quote/invoice or a flat fee.

Example: 10% based off $2000 worth of work: X, Y, Z are $200 each. Total is 30% potential bonus.

Also note, these are based off their flat fee quotes.

I gave them a simple task...or so I thought. Go to a meeting of contractors at a home owner's house. Take measurements and take a bunch of photos of the work that was to be done.

I instructed them to simply write the measurements and any changes on the scope of work sheet they were given. It lists each project. There were 6 projects.

They took 5 mediocre photos. They wrote nothing on the paper. Instead they used some mobile note taking software I cannot access unless I create an account.

It took them about an hour. (At these measurement meetings, it takes me 30 minutes max.) When they finally showed up to hand off the paper, it took them an hour (with me sitting around waiting for them) to upload their photos to DropBox... which they also failed to do. Part of that time was sending me links to their mobile phone app (which I could not access).

They missed taking photos of some of the projects. They missed some measurements (I can go take later). But it just caused me to think this guy cannot do anything new. I've given him independent tasks and he just fails.

He started at $20/hour. After 5 months I gave him a "tool raise" to finance $2/hour tools that I bought him. This because I kept having to clean up after him and put away the tools. About a week into that he quit for a $25/hour job.

About a month or two later he contacts me about working again. I offered him $25/hour for the tasks he was familiar with (that I already taught him). Except that means significantly less work because I'm not going to teach him anything new. (Not at this time of the busy season.)

He keeps asking for more work. That's why I gave him this $50 measurement meeting assignment. But he cost me quite a bit more time than it was worth (an hour of my time plus me having to go back and take measurements and photos of what he missed).

Edit

Oh, and I walked him through the last "measurement meeting" in person. I pointed out things to photograph and measure.

I'm pretty sure if I gave the same assignment to a newer employee, there would be far better results...

I think I just need to tell that problem employee they need more experience. I cannot keep paying them for work I need to redo.

Does having their license on the line and contract cure all?

I'm partially worried about a carpenter taking a down payment for mostly labor and disappearing.

I'm more worried about one taking payment and doing poor quality work. I've resorted to extensively wording contracts. But I still am uneasy about loopholes in wording.

I say this because I've seen a lot of substandard work.

---

List of fears from most to least

1. Bad workmanship: Mistakes hidden until after paid. Fly by night.
2. Job never finishes: Start, then disappears partway through. Whether that's because they did not realize the time commitment needed or otherwise. I'm stuck finishing their work (or mess). Related: no-shows.
   1. Not worth the risk of paying money down for labor?
3. Rarely works: Shows up in the middle of the afternoon a few times a week, minimal progress.
   1. Maybe something in the contract such as minimum number of hours/week or a deadline with liquidated damages? Although, this is small-time residential.
4. Unapproved helpers: Random people working. Wide variety of good quality and substandard work.
5. Damage property: Whatever happens and then expects me to foot the bill.
   1. Contractual solution.
6. Poor communication.
7. No warranty/support: Won’t answer when issues come up.

---

If they were making $30/hour, I wouldn't feel so bad about getting burned. But many want $90/hour or more.

One could say the solution is paying flat fee. But then there are issues with actually doing the work on a timely basis.

I don't have anyone exclusively working for me as W2. It's really hard to find good carpenters and handymen...

I'm stretched thin as it is. Last applicant had open meth case, $80 burglary from two years ago and various DWIs.

If you invest in real estate long enough, you will eventually run into contractor pricing problems. Many investors think the biggest risk is hiring someone who does poor quality work or disappears after taking a deposit (fly by night). Those happen, but one of the most common issues is much simpler: Paying too much.

Not every expensive contractor is overpriced, and not every cheap contractor is a good deal. The key is understanding why a contractor's price is what it is.

"I Don't Know What I'm Doing" Price

Some contractors price high because they lack estimating experience. Namely, they do not know how long a project will take. So they add a large cushion to protect themselves. You end up paying for their uncertainty.

Similarly, a high price could be because what you're requesting is vague. They are forced to account for unknown scope (and scope creep). This inflates their estimate. As a contractor, I've done this on fine custom cabinetry. The prospect client, "well we think we might what xyz from pinterest created but may want this other pinterest dream concept instead." So I included a budget of 5k per custom carpentry feature. (They didn't go with me because of my price.)

"I Don't Really Want This Job" or Fuck-You Price

Often a contractor does not want a particular project. Maybe it is too small, too far away, too complicated or they're booked out too far. Maybe it's the middle of the summer (usually the most busy part of the year). Instead of declining the job, they give a high price.

This is not necessarily dishonest, but investors should recognize that not every bid reflects the true cost of the work. As a contractor, I haven't given a fuck-you price. I just tell them how far I'm booked out and that usually ends the call.

Low Bid and Change Order Trap

One of the most damaging situations for investors is the artificially low initial bid. The contractor gets the job by appearing inexpensive, then additional costs start appearing after work begins.

Some change orders are legitimate. Renovations often uncover hidden problems.

However, experienced contractors can usually identify many potential issues before starting. Rot, outdated materials, poor previous repairs, and code issues are often visible during the initial inspection.

This happened to me earlier this year. Roofing GC says rotted facia needs to be replaced. I said ya, I'm going to replace them with PVC plank. (His company was the lowest bid.) They clearly saw rotted facia and thought they could pull a fast one by claiming all the facia was rotted and needed to be replaced. I could hear the distress in his voice when I declined their request to do the repairs :)

Middleman Problem

Some general contractors provide tremendous value by managing trades, scheduling, solving problems, ensuring quality and doing some of the work themselves. Others are simply middleman.

They collect subcontractor bids, add a markup, and don't really provide anything.

There is nothing wrong with GCs using subcontractors, but investors should understand what they are actually paying for.

A contractor who coordinates a project effectively can save an investor significant time and headaches. A general contractor who only forwards invoices to subs doesn't provide much of any value.

Most cities will provide a list of licensed contractors. It took mine three months to produce a list of every trade. (I already had a list of plumbers and electricians because they are publicly listed by the state.)

Advertising Agency Problem

Some companies are merely sales organizations than construction companies. They may have impressive websites, professional sales presentations, large advertising budgets and polished in-house customer experiences. Those things can be ok for deciding, but they do not mean the actual construction quality is better.

Investors need to separate marketing from production. A great salesperson does not necessarily equal a great builder. There are enough car salesmen tactics with realtors. And if I'm getting fucked, I want it to be by a pretty realtor not a fellow dirty smelly contractor lol.

Side-Hustle Premium

Many individuals start as side businesses while working full-time jobs. There is nothing wrong with this. A few excellent handymen and tradesmen/women begin this way.

However, many of these infant-age LLCs charge a premium because they don't need the work. They're only quoting high to make bank. Most of these jokers have little to no experience.

Investors should understand whether they are paying for actual project value or simply paying a pretty penny for a guy to cut his teeth learning on the job from youtube.

When Paying More Makes Sense

A quality contractor may cost more because they provide:

• Rush scheduling
• Clear and frequent communication
• Highly skilled workmanship with fewer mistakes (and fewer callbacks)
• Masterfully efficient work (e.g., completing that bath reno asap so it can be habitable again)
• Warranty support
• Professional customer service (your choice matters most with their guidance)

As an investor, I've started going with cheaper subcontractors because they have their license on the line. If they have poor quality workmanship, I do not hire them again. That, and I know enough how to correct their work if they fuck up too much.

Investors need to ask a few questions:

• What is the actual scope of work? Get three bids of specific scope to compare apples to apples. Some salesmen will try to screw around with scope to make it sound like they know more than what actually needs to be done. This is tricky. Try your best to keep scope the same among all bidders.
• What materials are being used? Avoid asking for itemized bids. Although, it's fine to ask what bigger ticket items are being used (such as the type of bathtub).
• What value is the contractor actually adding?

There are good contractors out there not trying to price gouge and cherry pick. Hopefully my little essay here does more help then harm in your entrepreneurial endeavors ;)

If you invest in real estate long enough, you will eventually run into contractor pricing problems. Many investors think the biggest risk is hiring someone who does poor quality work or disappears after taking a deposit. Those happen, but one of the most common issues is much simpler: Paying too much.

Not every expensive contractor is overpriced, and not every cheap contractor is a good deal. The key is understanding why a contractor's price is what it is.

"I Don't Know What I'm Doing" Price

Some contractors price high because they lack estimating experience. Namely, they do not know how long a project will take. So they add a large cushion to protect themselves. You end up paying for their uncertainty.

Similarly, a high price could be because what you're requesting is vague. They are forced to account for unknown scope (and scope creep). This inflates their estimate. As a contractor, I've done this on fine custom cabinetry. The prospect client, "well we think we might what xyz from pinterest." So I included a budget of 5k per custom carpentry feature. (They didn't go with me because of my price.)

"I Don't Really Want This Job" or Fuck-You Price

Often a contractor does not want a particular project. Maybe it is too small, too far away, too complicated or they're booked out too far. Maybe it's the middle of the summer (usually the most busy part of the year). Instead of declining the job, they give a high price.

This is not necessarily dishonest, but investors should recognize that not every bid reflects the true cost of the work. As a contractor, I haven't given a fuck-you price. I just tell them how far I'm booked out and that usually ends the call.

Low Bid and Change Order Trap

One of the most damaging situations for investors is the artificially low initial bid. The contractor gets the job by appearing inexpensive, then additional costs start appearing after work begins.

Some change orders are legitimate. Renovations often uncover hidden problems.

However, experienced contractors can usually identify many potential issues before starting. Rot, outdated materials, poor previous repairs, and code issues are often visible during the initial inspection.

This happened to me earlier this year. Roofing GC says rotted facia needs to be replaced. I said ya, I'm going to replace them with PVC. (His company was the lowest bid.) They clearly saw rotted facia and thought they could pull a fast one by claiming all the facia was rotted and needed to be replaced. I could hear the distress in his voice when I declined their request to do the repairs :)

Middleman Problem

Some general contractors provide tremendous value by managing trades, scheduling, solving problems, ensuring quality and doing some of the work themselves. Others are simply middleman.

They collect subcontractor bids, add a markup, and don't really provide anything.

There is nothing wrong with GCs using subcontractors, but investors should understand what they are actually paying for.

A contractor who coordinates a project effectively can save an investor significant time and headaches. A general contractor who only forwards invoices to subs doesn't provide much of any value.

Most cities will provide a list of licensed contractors. It took mine three months to produce a list of every trade. (I already had a list of plumbers and electricians because they are publicly listed by the state.)

Advertising Agency Problem

Some companies are merely sales organizations than construction companies. They may have impressive websites, professional sales presentations, large advertising budgets and polished in-house customer experiences. Those things can be ok for deciding, but they do not mean the actual construction quality is better.

Investors need to separate marketing from production. A great salesperson does not necessarily equal a great builder. There are enough car salesmen tactics with realtors. And if I'm getting fucked, I want it to be by a pretty realtor not a fellow dirty smelly contractor lol.

Side-Hustle Premium

Many individuals start as side businesses while working full-time jobs. There is nothing wrong with this. A few excellent handymen and tradesmen/women begin this way.

However, many of these infant-age LLCs charge a premium because they don't need the work. They're only quoting high to make bank. Most of these jokers have little to no experience.

Investors should understand whether they are paying for actual project value or simply paying a pretty penny for a guy to cut his teeth learning on the job from youtube.

When Paying More Makes Sense

A quality contractor may cost more because they provide:

• Rush scheduling
• Clear and frequent communication
• Highly skilled workmanship with fewer mistakes (and fewer callbacks)
• Masterfully efficient work (e.g., completing that bath reno asap so it can be habitable again)
• Warranty support
• Professional customer service (your choice matters most with their guidance)

As an investor, I've started going with cheaper subcontractors because they have their license on the line. If they have poor quality workmanship, I do not hire them again. That, and I know enough how to correct their work if they fuck up too much.

Investors need to ask a few questions:

• What is the actual scope of work? Get three bids of specific scope to compare apples to apples. Some salesmen will try to screw around with scope to make it sound like they know more than what actually needs to be done. This is tricky. Try your best to keep scope the same among all bidders.
• What materials are being used? Avoid asking for itemized bids. Although, it's fine to ask what bigger ticket items are being used (such as the type of bathtub).
• What value is the contractor actually adding?

There are good contractors out there not trying to price gouge and cherry pick. Hopefully my little essay here does more help then harm in your entrepreneurial endeavors ;)

https://preview.redd.it/7f8durol33fh1.png?width=584&format=png&auto=webp&s=12ff56852ce533171b26dad3869dac5ee0b230fa

• Self-employed boom and bust contractor. Degree in electrical engineering. Did that for 4-5 years. Now into home remodeling, carpentry and general contracting.

  • Bought a house for 150k. Reno for 30k. Cash out refinanced 75% appraised value of 300k. Paid off first loan.
    • Put profit into buying another two properties worth 100k combined. Work on these two properties will last 1-2 years if I DIY (but I will subcontract to accelerate progress). One will be my first flip and the other will stay a rental like the rest.

• I try to read every day. I used to be into weight lifting. Wish I was doing that at least every other day.

• Plant-based at home, vegetarian when going out to eat.

• My greatest of the seven deadly sins is probably lust (among pride, greed, envy, gluttony, wrath, and sloth). But maybe that won't be so bad with a long-term partner.

• Women that I've dated in the past do not like how much time I spend working.

• I'd be on board with polyamory. I'm not clingy. But I realize the majority think of that as just about sex and taboo. So I'm fine with monogamy.

• Seeking a fine feline who is in or open to relocating to the Midwest. I'd probably eventually move to a woman in Texas. I just gotta tie these houses in a bow before that.

• The only real criteria I have is that you read books. I don't know why so many are anti-literacy.

• Probably wouldn't be a good match if you're younger than mid-20s or too much older than me.

I order material. I check the right materials are on site in roughly the right quantities the day before. I keep extra flashing and various parts/materials on hand. I cover OSB and such with tarps if there's rain.

Should I spot check the crews quality? Make sure they're laying ice and water shield? Or just leave that up to their lead? Would it be weird if I helped clean up some in the middle of the day?

I would rather be as low involvement as possible while somehow still ensuring it's done right.

I've worked with two different subs and have had poor quality results at times (still very new to roofing). This is mainly just a supplement to my carpentry work. Because 9/10 roofing companies in my main city are just "advertising agencies." The bigger ones have local 1099 repair techs. But I would do that if there was an issue in the future.

My main city has this housing rehabilitation program. I've went to several "bid meetings" where only contractors who come to see the house can bid the project(s).

The only others that come to these is another GC from an hour away and a restoration company. I was so confused why no one else came to these... I specified how I would take draws in my submitted bids. Apparently, the city facilitator of this program didn't understand or pay any attention to that part of my contract.

They get back to me saying they can only do one draw per project. And it can only be for the receipts of material purchases. What?? Last one I bid had about 5 different trades.

Then it hits me. So few are bidding on these projects because they do not have the money, credit or capacity to continually do these projects with that kind of payment schedule.

I can float the projects I bid on with my own savings. But for future projects I'm going to have to take out a big line of business credit. Any tips or experiences with that? It's guaranteed money. I just do not think most subs are going to accept delayed payment. That's why I think I need to get a line of credit.

*guaranteed to be paid job

Background

Through the city, just about every other week there is a bid meeting for a new residential remodel project. So far:

1. full siding and trim house and garage
2. siding house, electrical service upgrade, foundation replacement, half bath remodel
3. full bath remodel, kitchen flooring, storm doors

Contractors need to show up to the bid meeting to measure/inspect or they're not allowed to bid. So far I've gotten all the jobs I've bid on.

Normally I do some portion of the work (except most exterior work). For example, for #1 the siding was subbed out and I replace the rotted sill of a garage window. For #2, I'll do the half bath (and sub out the rest). I also know some fairly inexpensive siding and masonry subs.

My competition is a restoration company and a GC from an hour away. The city person coordinating this all showed me the format the GC uses. (Pricing was edited out.) He's writing a scope with things like "floating bathroom vanity" and the most extremely wordy scope details I've ever seen. It's got things clients do not care about like brand of house wrap.

The clients are low to medium income. I'm writing my scope based off a budget.

The challenge

These projects keep coming. I cannot do as much direct work as I normally do. I either need to sub more out, hire a mechanically inclined apprentice or throw 1099 handymen a bone. I also have my own houses with ongoing renovations.

Any tips or ideas? I know a carpenter who got a few of these jobs a while back. But I think he tried to tackle most everything himself (spread himself too thin).

Hell, I may even be able to sub out some work to other local GCs... markup their markup.

Quote for small bathroom floor. (I will demo existing.) They supply all materials except LVP and transition:

• Install 4x5' bathroom LVP (LifeProof 22 MIL - supplied by GC)
• Perimeter Seal Waterproof Flooring Tape
• PVC baseboard (sand any letters/markings, cut and glue)
• Caulk top of baseboard
• Install flexible quarter round at shower base (or caulk if lip too small)
• Install transition to kitchen (transition supplied by GC)

First sub quotes $900. I'm getting other quotes, but that one would be more than $40/sqft (with trim included). Probably $200/hour...

His price is his price. But if all the subs quoted like that, my company wouldn't get the overall contract (multi-trade job). Wisconsin, low cost of living.