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My Dilemma: Hire a Contractor or Contract everything out Myself

My Dilemma: Hire a Contractor or Contract everything out Myself


  #1  
Old 08-26-10, 03:24 PM
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My Dilemma: Hire a Contractor or Contract everything out Myself

Hi, Everyone.

Hope I potsed this in the right place!

I have a dilemma. Maybe some of you can offer some advice.

I have to do some remodeling on a small house I inherited. I ONLY have $25,000 to work with. I want to rent the house out.

It needs quite a bit of work. I have been able to do some of it myself, but I have reached the point where I will now have to spend the money on the things that I cannot (or don’t want) to do.

What I need in this house are the following: a Totally new kitchen, including floor, new carpet, paint in and out, some repair to the walls, air conditioning (California…and there is no air in the house, only a heater), new floor in the bathroom, old fireplace dry walled over.

I have two choices, as I see it.

1: Hire individual tradespeople or companies that do one thing ie: installing a kitchen., hiring a painter, etc.

Or

2; Hiring a remodeling contractor to do everything for me.

The house is just shy of 1000 sq ft. It also desperately needs some landscaping, as it looks like the “Munster house” on the outside.

Contracting it myself:

I have done some research on this. I have enlisted the help of a friend who is a professional landscaper, so he has a lot of contacts in the business. He thinks that I can do it quite effectively by piecing the work out myself. He has referred me to a painter that he has used on his own house many times, and he has referred him out to at least 50 of his own clients, and has always gotten excellent reports back. He charges $125 a day…I would supply the paint.

I have found a company that will do what I want in the kitchen for a total price of $10,000. I really like them , their work looks good, and they have a lot of choices.

Carpeting from Home Depot or Lowes will be about $1800.

I have not entirely researched this, but I have been told by one contractor that I can have central air installed in this house for about $6000-6500.

The Landscaping will cost me about $5000, which will include a new lawn, sprinkler system, and a new concrete walkway. NOTE: I will receive a significant discount on the landscaping, as I will be bartering some of the work in exchange for designing a new web site for the landscaping.

So, by contracting my self, the numbers would look something like this:

Landscaping: $5000
Kitchen $10,000 (including ceramic tile floor)
Painting $1800
Carpet $1800
Air $6000
Bathroom floor tile $300

Total: 24,900 MINUS an unknown discount form the landscaper for building him a website.


Having a Contractor do it all:

I searched Angie’s List, and found a contractor that had a LOT of very good recent responses, and over 200 total reports. It turns out that they were within walking distance of my house, so I walked over, and made an appt for an on-site estimate.

The owner came over to the property, and we talked for a while and he took some notes. We made an appt to meet at his office, and of, course, he wanted me to bring my wife. He gave us both a printed list of the items that would be accomplished.

They were:

New kitchen (He included a fair amount of detail…they do NOT include the sink. ), and there would be VINYL flooring, not ceramic tile.
New carpet
Paint inside, and paint/repair of the two large panels of wood siding on the house exterior…but that’s all on the outside.
Repair, replacement of various electrical outlets.
Drywall over old fireplace.
New Toilet
New floor tile in bathroom (NOT ceramic tile, but same vinyl as in kitchen)
NO air conditioning
NO landscaping
He provided a fair amount of detail with regard to things like baseboard, etc.

Price:…..well, he wouldn’t give me a final price, but he knows my ABSOLUTE MAX is $25,000. He said he does not want to give me the price until I have talked to other contractors. I suspect that it will be right at $25,000, perhaps a little less, but he would NOT give me a price, and would not let me take the printouts he prepared.

He says he can do the entire project in three weeks.

As I said, he is highly rated on Angie’s list. While we were there, he got a couple of current customers on the phone to talk about their projects, and they both raved about him and the service. He also should me stacks of “thank you notes” and an entire binder full of questionnaires that had been filled out by customers after the completion of the jobs. They all, of course, were glowing.

I liked this contractor, because he was very enthusiastic and seemed to care about service a LOT. Nice offices and staff, had a nice showroom, and they seem to be a very legit business.

So, therein lies my dilemma. For about the same money, I can get substantially more by doing it piecemeal( Air, Landscaping…). Or, have it all done by one company.

Your thoughts?

Any thoughts or ideas would be GREATLY appreciated. This is a HUGE decision for me, and I am simply unsure of which way would be better.

Thanks!
 
  #2  
Old 08-27-10, 04:25 AM
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You‘ve done a lot of homework.

Part of the dilemma is caused by an apple to orange comparison . . . there are items in one list and not the other. Hard to know what your are absolute priorities are vs. nice to haves. Rearranging your lists based on completing same tasks will give you a clear comparison.

In terms of having one contractor vs. multiple ones, I would group all construction related (some could be handled by a handyman) projects together to obtain a price quote for doing that work. Stuff like carpeting, A/C, and some other items will be probably be cheaper for you by not having the one contractor serving as a middleman. One point about the contractor nearby . . . if comfortable he’ll do a good job, being close is an advantage as less travel time to job site usually means more work time on job (or not pricing that lost time into his proposal).

While focus is on cost, completion time should also be a consideration. Since this is going to be a rental, loss of rental income because of taking longer if you’re short on time to organize and hire multiple people to assist you, should be a consideration in your overall analysis. Stuff like landscaping may be able to be done after renting it out so long as that understanding is worked out w/ tenant beforehand.
 
  #3  
Old 08-27-10, 08:22 AM
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If you're going to be a landlord, it's time to learn the meaning of the term 'sweat equity'

A lot of the profit in rentals is made by cutting costs - we do as much of our own work on our units as we can, contractors cost a lot more

This is a DIY website, we can walk you through just about any project you want to take on - there's also a lot of satisfaction received from doing it yourself instead of hiring it done
 
  #4  
Old 08-27-10, 08:41 AM
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I recommend being your own general contractor. It will be more leg work but you will save money.

Do not get open ended bids! $125 a day? What if it takes him 2 months? Contractors should be able to give you a hard number for the work they will be doing as long as you and they stick to the agreed scope of the work.

Make sure you get detailed quotes so then if the contractor comes to you with extras you can pull out their quote and show then what was agreed upon.

Only accept the extras if you agree to them before the work is completed. An extra because they forgot to put something in the bid is their fault. You should not have to pay for their mistakes.

The contractor is not going to give you bad reviews to read. If he is so good then he should be able to give you a solid number or at least say he can do it for under the $25K or not.
 

Last edited by Tolyn Ironhand; 08-27-10 at 09:22 AM.
  #5  
Old 08-27-10, 09:20 AM
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If you are going to be your own GC, expect the total job to take a lot longer. If subs are busy, you will surely be the fill in work when they get time. Subs, stay busy by working on a continuous basis for several GC's. Because the GC's give them plenty of work, they'll move their schedules around (as best they can) to keep the GC happy, so that future work keeps coming. I try to use the same subs (if they are good) on each job, as I can somewhat control the timeframe for getting the work done. In short, if the subs have relationships with GC's, they'll do that work first and yours when they can.

While focus is on cost, completion time should also be a consideration. Since this is going to be a rental, loss of rental income because of taking longer if you’re short on time to organize and hire multiple people to assist you, should be a consideration in your overall analysis.
Rob makes a great point here.

The contractor is not going to give you bad reviews to read. If he is so good then he should be able to give you a solid number or at least say he can do it for under the $25K
I agree, I've never had a homeowner say yeah, go ahead and do it without having a contract and a price. If this guy cant give you a price, surely other GC's can.
 
  #6  
Old 08-27-10, 06:20 PM
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It doesn't sound like you have much to do and that what you have isn't overly complicated. You've already went out and got prices for the work. I don't see a whole lot where the different subs need to be coordinated. The most complex thing you are having done is the kitchen. The landscaping is being done by your friend. Getting someone in to tile the bathroom and having HD do the carpeting is no big deal. The open ended painter is a negative in my view, but I guess you could finish doing that if you run out of money. I would avoid the GC myself. I doubt you are going to get the level of service from him that you think you will. He probably won't be there a whole lot since not much is going on. The whole thing about him not giving a price until other contractors give you a price is complete BS. I would have pressed him on that issue and flat out told him he had 0 chance of getting the job if he didn't provide a number. I can understand him not giving you all the detailed paperwork though. That prevents someone else from using his hard work for free.
 
 

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