A Contractor can be a real estate investor’s worst nightmare or biggest hero, and I’ve experienced both.  This is the first time I’ve actually sent a contractor travelling to a remote location to run a renovation project for me.  One week into the project and here’s the first report.

Background:

Several weeks ago I held one of my weekly support calls titled “The Contractor – an investor’s worst nightmare or biggest hero” (you can register for these calls HERE), where I invited an experienced contractor on the call to talk about why there is such a disconnect between contractors and investors.  If you were on that call, you may recall that the discussion tuned towards the property I have in Virginia Beach, and how this was a nice light rehab.  My contractor, Jeff, got all excited about the possibility of going to Virginia Beach and doing a little surfing.  All joking aside, the real reason he got excited was because his daughter was having a baby any day and he imagined himself going through Alabama to see his brand new grand-baby for the first time.

Local Contractors:

I got several quotes from contractors recommended by my listing agent and both quotes came in right at my budget (kind of makes me wonder how they knew my budget – most likely the listing agent), and both quotes concerned me as there was no room for surprises in those quotes.  When you purchase properties sight unseen, there are always surprises.  It could have been the A/C, or anything.  I just wasn’t feeling very comfortable with these quotes, these contractors and in general, I wasn’t “feeling the love” from the Virginia Beach area.

So this, plus my local contractor, Jeff, offering to manage the project on site, turned less into a joke and more into a reality.  After a lengthy discussions on the logistics and costs of travel, accommodations and paying for his efforts, we agreed on a fee for him plus materials.

The First Week:

Jeff was delighted to head out to Alabama to see his grand-baby and connect with old friends.  He managed to pick up a “helper”, a young man that had never been out of the state and still didn’t have a career direction (son of a friend), and they headed towards Virginia Beach.

The Surprises:

Knowing this unit didn’t have electricity or water, I knew I couldn’t expect him to stay in that condo on his blow-up mattress. So luckily Priceline.com found a great rate for these guys for 2 days – $85 over budget so far.  That’s OK.  I hadn’t really thought of that and it was my fault for not having this in the budget to begin with.  That was a minor surprise.

Here it comes, the real surprise: Mold.  Not that mold is a real issue for me as an experienced rehabber, but the fact that 2 contractors and an agent had been in the unit and not mentioned the mold to me was disconcerting.  The mold itself wasn’t really that bad, but the falling ceiling from the moisture that make the problem really obvious.  Why didn’t the contractors include this in their quote?  Why is this the first time I’ve hears about this?  I suspect less than ethical intentions from the local contractors.

So the electricity came on and the A/C works!  It does need some repairs since it’s the condensation that contributed to the ceiling collapse – but a nice tune-up and I’m happy.  But I couldn’t have this contractor and his helper stay in that condo with the mold in that environment…OK, back to Priceline.com – $350 for a week which isn’t too bad, but not in my budget.

As of this writing, the contractor purchased most of the major supplies at Home Depot – flooring, sheet rock, cabinets, tiles, etc. all under $3,000.

Still outstanding is the granite and miscellaneous trims, etc.  So far I’m still under budget.  Part 2 is coming next week.

Feel free to ask any questions or comment below!