For Investors Only

Generally, real estate investors make a living out of buying, selling and owning property. This is why it’s very important to understand the nuances of real estate deals. Making informed decisions and having the right people by your side will not only make things easier, but more importantly, will give the highest return on your investment with the least risk.

If you are a real estate investor who hasn’t tried flipping yet or a seasoned veteran not making the profit you initially forecast, you may wonder how you can actually get the highest possible return on your investment while mitigating your risk. This is where project consulting and risk management services come in.

One of the latest trends in real estate is house flipping (or “flipping”). By definition stated in Investopedia, it is a type of real estate investment strategy in which an investor purchases properties with the goal of reselling them for a profit. Profit is generated either through the price appreciation that occurs as a result of a hot housing market and/or from renovations and capital improvements.

General Description of the Services

Renovation project consulting and risk management services provide investors with an owner/investor representative.

  1. Prior to finalizing the purchase, known as the option period, as your representative we go out to inspect the home and provide an:
    • Estimate of the price to renovate the home for resale
    • Detail out potential areas of concern
    • Provide and estimated timeline for the renovation.

If the Investor/Owner decides to purchase the home the next step for the consultant is dependent on the level of involvement they want to have. Here are 2 options for Investors once they have purchased the property and want our help managing the project and keeping it on bugdet and

Hands off approach:

  • Your Renowned Renovation Consultant and Investor discuss project budget and desired areas of renovation.
    • Consultant takes all measurements, makes all material selections, procures finish materials for Investor
    • Creates an RFP (Request for Proposal) that Consultant and Investor can send out to qualified General Contractors to bid on.
    • Consultant and Owner review bids and Consultant provides a recommendation.
    • Consultant assists in contract negotiations and payment terms
    • Consultant creates a schedule of values based on percentage of work complete.
    • Investor purchases all finish materials using Consultants discounts so there won’t be large upfront payments to contractors or material markup.
    • Consultant to review Contractor work on a weekly basis for quality, schedule, and security
    • Consultant reviews all applications for payment prior to being sent to Owner.

Hands on approach:

  • Investor acts as General Contractor. Consultant and Investor discuss project budget and desired areas of renovation.
    • Consultant takes all measurements, makes all material selections, procures finish materials for Investor
    • Creates an RFP (Request for Proposal) that Consultant and Investor send out to qualified subcontractors to bid on.
    • Consultant and Owner review bids and Consultant provides a recommendation for each trade.
    • Consultant assists in contract negotiations and payment terms as well as creates a schedule of values for each trade based on percentage of work complete.
    • Investor purchases all finish materials using Consultants discounts so there won’t be large upfront payments to contractors or material markup.
    • Consultant to review subcontractor work on a weekly basis for quality, schedule, and security as well as review all pay applications prior to being sent to Owner.
    • Owner will manage trade flow and schedule with Consultant.

Definitions and why they benefit the Real Estate Investor

  • Request for Proposal: Creating an RFP qualifies all aspects of the product or service based on liner, square, or unit pricing. To truly compare different bidders, you must standardize the manner they price the work.
  • Qualified Contractor: Insured, experienced, letters of reference, and vetting process that includes going to work in progress to verify capacity and quality.
  • Schedule of Values: a detailed statement furnished by Consultant outlining the portions of work and the contract sum. It allocates values for the various parts of the work and is also used as the basis for submitting and reviewing progress payments. Owner/Investor exposure for overpayment. As long as the project goes well, everyone is happy. If there is a default by a contractor or if the Owner has conflict with the financier, you can expect those folks to be scrutinizing the payment application process to see if there is a way to recoup some of the money. One of the first things they look at is whether the people certifying the payment applications were negligent. Should they have been on notice that something was amiss on various line items? As a result of court cases on this point, architects, engineers and firms acting as owner’s reps are increasingly cautious about agreeing to schedules of values that look at all unbalanced.
  • Insurance: Understanding policy coverage, liability, and project risk is paramount to ensure the Investor is not carrying unnecessary risk while there are many efficient and cost effective ways to mitigate.

Pricing depends on the size and scope of the project.  Please call for a free estimate.