Hiring A General Contractor: When You Should and When You Shouldn’t

If you are a builder or Fix and Flipper, you have undoubtedly thought about whether or not to outsource the General Contractor role on your projects. The obvious benefit to not hiring a General Contractor is the money you will save, but what is the cost to save that money?

A General Contractor is someone that will oversee your project. They will manage all the subcontractors and help get you to the finish line. They are generally not as skilled at specific tasks, like plumbing or electrical, but might be more organized and should understand the basics of the entire project.

BENEFITS OF ACTING AS YOUR OWN GENERAL CONTRACTOR

In most cities you will be allowed to act as your own as long as it is a smaller job or you hire and manage licensed subcontractors. General contractors will want to be paid for the value they bring to your project so if you choose not to hire one, that savings will go directly to the bottom line. Paying less for the rehab could mean more profit for you.

Another benefit of acting as your own is the experience you will gain. As a real estate investor, it is a good idea to have a basic understanding of what it takes to rehab a house. This will help you with future projects or come in handy if you ever hire a bad contractor.

Finally, if you don’t have one in the way, you will be in much more control. Not saying it would happen, but I could see when there might be a time when you end up with a bad one. Getting a General Contractor off the job is not easy. They could have their crews working and they might owe their subs money. Dealing directly with the subs actually doing the work is often times much easier.

BENEFITS OF HIRING A GENERAL CONTRACTOR

Although I am acting as a co-General Contractor for a house I am building for my girls and I, I am a big believer in using one on your projects. This becomes especially true as you grow as a real estate investor. It is extremely hard to scale your investing business if you are working in it, so anything you can shift to someone else while still making a profit will help you grow. Aside from shifting the workload, here are some other reasons why you might consider paying for a General Contractor:

They understand building code and can ensure work is done according to that code.

If you have a good one, you will save money on your holding costs because they know how to complete a job in an efficient manner.

It is a great way to shift liability. If something is not done correctly, you can shift that responsibility to the General Contractor or their insurance. They should also manage any warranty issues.

They could actually save you money, because often times they have good relationships with subcontractors and get preferred pricing. This could be true with material suppliers as well.

Although I think it is best for most investors to hire one, there are good arguments either way. It is not a terrible idea to go through some deals without help so you can learn the process. That is exactly why I decided to take on that role with my new home. It also might come down to how much time you have and your ability to do the job. Most investors can handle smaller jobs without the help of oner. Experienced investors can likely handle even large jobs without any help. If you have the time and want to maximize profits, I can see you taking on the role, but if you are limited on time or are more interested in growing, you probably want help.

I am a big believer that in order for you to maximize income, you need to focus on two things. What you are good at and what makes the most money. In my opinion, finding and negotiating deals is a much higher paying activity than managing subcontractors. That, and I am learning that not everyone is good at running a project.

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5 Things You Can Do With Real Estate Software

Real estate management is not that easy, especially when you have so many things to think about. With the right real estate software, however, you will be able to make the management process easy and smooth so you can run your businesses without putting in too much effort. The best thing about the solutions is that you can customize them to match your exact property needs. Software programs designed for estate industry are scalable so you are able to grow with them as your business continues to grow. There is so much you can do with real estate software and they include the following.

1. Manage contacts

Using the best software program, you can manage details of contacts in defined groups making it easier for you to access them any given day. A good program will also make it possible for you to maintain detailed information of customers and clients and even automate good wishes on their anniversaries, birthdays and other celebrations.

2. Manage employees

When you have software for real estate, you can easily have a number of users working within one account. This you can do by creating multiple employee logins and hierarchies according to your organization structure. It makes allocation and execution of work easier by everyone from admin to managers. Using the system you can also manage daily reporting of your employees and at the same time monitor their performance. They on the other hand will be able to schedule property inspection, meetings and task reminders making task execution more efficient.

3. Integrate real estate portals and websites

From your CRM account, you can control your website so you have an easy time keeping it up to date. The estate management solution makes it possible for you to create and integrate web portals where you list your properties directly. You can publish projects from property software to website and build a reputable brand using professionally designed real estate websites. This kind of coordination promotes consistency in your real estate business and this will favor your management processes and improve your brand image.

4. Maintain reports and analytics

As a serious estate business, you ought to keep up with what matters most to the business. Using the best software for the real estate industry, you can easily fetch yearly, monthly and daily reports of enquiries and properties. Using the program you can pair matching reports for properties and open enquires and even categorize the enquiries by source. You can also keep abreast of all pending activities so you do not leave anything of importance out.

5. Manage rent and payments

Using your software, you will be able to archive all payment information on your properties, automate lease endings and payment collection reminders as well as schedule convenient payments. The program also makes it easy to get complete payment reports and will ease out the process of generating and sending receipts to all your clients across the platforms.

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There Is No Try or Excuses: You Either Do or You Don’t

It was a rainy and cold January morning. I was wet and miserable, yet I was running in a formation at 6 in the morning chanting about killing the enemy. Drill sergeants were yelling and screaming while people were falling out of formation, some to puke up the previous night’s dinner. I did not dare fall out of that formation. I was already on the “shit list” for laughing at a drill sergeant a few days earlier. One drill sergeant kept shouting the same thing over and over. “No Excuses!!!” I made it to the end of the run that day with less than half my platoon, soaked from sweat and rain feeling sick to my stomach, yet proud of my accomplishment.

Four years later I was trying to learn how to be rich. I came across a mentor who was originating conventional loans and I stuck by his side as much as possible. He taught me to focus on removing “try” from my vocabulary. Try is a copout. It is a way to feel good about not being successful. “There is no try, you either do or you don’t,” he would say. If something did not work out the way you want, you can focus on the fact that at least you tried… you can focus on making it happen.

Before my mentor taught me that the words I use, (or not use in this case), are important or before I learned about not making excuses from the military, my dad would tell me, “You only fail if you give up.” This is something I learned long before I ever left the safety of his home. I don’t remember how old I was, but this is one of those lessons that stuck with me. I can make mistakes, not have the success I want, or have a setback and not really fail. The reason, of course, is I can learn from the attempt and try again.

A few weeks ago I was on a trip to Minnesota and I had lunch with this amazing person which sparked my desire to write this article. She is originally from Vietnam where she grew up in a poor family working on a farm. She had no money and was not able to finish school. We had a discussion about a bike and I remember her saying she did not have one growing up. She was forced to drop out of school so she could work and help support her family to survive. She came to the United States as an adult, not able to speak English. She got a job as a server in a restaurant and attended an adult high school so she could earn her diploma. Amazingly, she taught herself to speak English, mostly while interacting with customers at the restaurant, and graduated from school. She decided to pursue an education in Information Technology and received her Associates degree. Deciding she did not want to work on computers, she shifted focus before pursuing her Bachelors degree and went to real estate school. She received her license and now has a thriving real estate business. She owns her home free of debt and has rental property and savings. She is happy.

As I listened to her story in amazement, I thought about the times that I was discouraged and felt sorry for myself with my setbacks. Can you even imagine what she had to overcome and the setbacks she must have experienced? I also kept thinking about the clients and prospective clients that simply give up, or make excuses, and never reach their potential. The reason I was visiting Minnesota was to deal with a problem from one of our clients who got into trouble and then decided to give up on the project. This client failed and will never be successful.

If this Vietnamese woman with no money or job can become successful when she could not even speak the native language, there is no excuse for anyone reading this article! I put myself in that category because God knows I have not seen everything through that I have wanted to accomplish. The good news is, I don’t have to stop reaching for my goals. If she can accomplish what she did, I can accomplish what I want without saying I tried or giving an excuse. Remember you either do or you don’t. I chose “do”.

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Real Estate ERP And How To Get The Most Suitable One

ERP, enterprise resource planning, is business management software which allows organizations to use systems with integrated applications to manage businesses and to automate different functions of the back office. These functions can be related to human resources, services and technology. ERP software integrates all operational facets including development, product planning, manufacturing, sales and marketing all in one database, user interface and application.

ERP software for real estate makes management of properties easy for managers, owners and investors. There is so much that goes into the management process of real estates and the right system helps in making things a lot easier. Software tools are so many in the market today that it can be overwhelming to choose the most suitable for you. But when you ask yourself a few questions that matter making the right decision should not be that hard to do.

How will the ERP solution help you grow profits?

Even in real estate, you will be looking for ways to maximize profits and this means that you should choose a real estate ERP that has what it takes to take your business a notch higher. Good management software should be able to handle everything from ongoing maintenance schedules to tracking payment information of tenants and employee performance to ensure the ash flow remains steady. The software you settle for should also help in spotting trends that could be having negative effects on your business so you can create strategies to address the underlying issues.

Will the ERP system save time?

Data is critical in real estate yet it can be really tedious to handle without the right tools. When looking for a good real estate ERP solution, it is important that you choose one that will save you time when managing your data. A good solution should provide a consistent location for all the data and at the same time make it possible for you to gain access to the data at any given time and place. You should also be in a position to customize data entry so you spend less time getting things done when they need to be done.

Does it require any kind of support and training?

Getting new software for your business will always come with a transition period. This does not however mean that the period should be too long either. A good platform will come with a user interface that is friendly enough to make the employee transition pass quickly and as conveniently as possible so you do not waste time unnecessarily. Choose a real estate ERP that is easy to use so there is reduced time when tracking, managing and changing data as appropriate. Ongoing technical support and training is reasonable, but it should not rob your business off the positive impacts you expected when you got the software in the first place.

It would also be helpful to consider what data analysis and reports you can create using your ERP management software so you can choose a solution that fits your ongoing data requirements.

Real estate ERP offers lots of flexibility and convenience running a property business. Choose the best solution from the best company in Dubai to enjoy the many benefits of having such a system in place.

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3Rd Quarter Housing Data Shows Now Is a Good Time to Fix and Flip in Washington DC

The recent presidential election generated tremendous interest in the Washington D.C. area real estate market. Figures from the third quarter indicate conditions that favor investment in new and redeveloped property, including:

· Low inventory: Demand for housing outstripped supply in Q3. Strong demand in the first half of 2016 depleted available inventory, dipping to the lowest level since 2013 Q3. There is a slim 2.8-month supply of homes in the D.C. area, compared to a supply of 6 months when demand and supply are balanced. The lack of inventory cut the number of sales and the rise in prices. Nonetheless, year-over-year third quarter sales volume increased 4.1 percent in 2016. Best price growth occurred in the Urban Core and the Outer Suburbs of the District.

· Faster sales: On average, it took only 47 days for homes in the Washington D.C. area to sell during Q3 of 2016, down four days from the previous Q3 and well below the 10-year average of 66 days. The Outer Suburbs saw the steepest drop (six days) in days on market, which was most likely due to low fuel prices, low interest rates, and relatively more inventory compared to closer-in neighborhoods.

· Seller reluctance: The demand for new and redeveloped units is extremely high, in part due to the reluctance of homeowners to sell. Many owners are simply unable or unwilling to sell if their home hasn’t appreciated enough for them to profit.

An Optimal Time to Fix and Flip

These factors point to a golden, if perhaps short-lived, opportunity to invest in housing throughout the Washington, D.C. region. Demand far outstrips supply, inventory remains low and houses sell quickly. Renovation of local properties would help increase the housing supply and increase prices. And the resale of those properties for a healthy profit looks promising. The new administration will be looking to stimulate growth through tax cuts, reduced regulation and job creation, conditions that naturally favor higher housing prices.

The window of opportunity is also defined by the relatively low costs for labor and materials that currently apply. The fiscal stimulus promised by the new administration, which is targeting up to 4 percent annual growth in GNP, could stoke inflationary pressures, meaning a year from now it may be much more expensive to fix and flip residential property than it is today. In other words, the cost of capital may be going up.

Walnut Street have been deeply involved in the local building and development communities for more than two decades. Contact us for information about how we can help you quickly fund your renovation project.

Walnut Street Finance helped builders and developers get real estate hard money loans in the Washington, D.C., Maryland and Northern Virginia.

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