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Tuesday, March 07, 2006

House 3: Estimate Clarification

I got a response to my fax to the handyman requesting some clarification of his estimate. He was checking into whether or not he could move the car legally (since I don't have title to the car). This is similar to a situation I ran into on my last rehab, so I was pretty sure there would be no problems removing it. Just to be sure, I called the Phoenix Police Department to check. (My last property was in Glendale and the city code might be different in Phoenix.) Indeed, the car is treated as an abandoned vehicle on private property and therefore, the property owner can do what he wants with it. Technically, the towing company is supposed to contact the police department with the license plate number or the VIN number to see if the car has been reported stolen. However, that is not the responsibility of the property owner. Anyway, I passed this info on to the handyman.

As for the other issues:

- The removal of the shed, folding door, and door frame at the archway are included.

- He counted three windows that needed to be replaced, so I'll trust him on that.

- He will remove the cabinets and, if there is good drywall behind it, the wood paneling as well.

- He forgot to include the new toilet in the estimate wording, but it was included in his price.

And speaking of the price, he didn't lower it :-) He also rejected my request for dates and penalties / bonuses for late or early completion. According to him, he cannot schedule the work of his subcontractors and therefore can't make promises for them. If he were to do so, the state of Arizona would consider them employees of his company. He said he has spoken with all of them and they all agree to do their best to meet the 4 week schedule. A start date will be provided as soon as he receives my first payment, which I placed in the mail this morning.

I'm not sure I buy his argument about not being able to schedule the subcontractors. He doesn't really need to. He just has to tell them when he needs the work completed by. But I'm not going to push it. He claims his motivation to finish the job is his final payment.

The good news is that he is using subcontractors. That means it won't just be him working on the job, which means it should get done faster.

4 comments:

SLOMONEY said...

I think your getting screwed!! for what you want done you could do for about $10,000 including carpet. Just do it yourself and hire out subs for the drywall etc and get some day laborers for the other stuff, just my $.2. The only time i spent 23000 on a rehab was when it was taken down to the studs, also aded a new driveway,new 50 yr comp roof and concrete coutertops - higher end remodel

Trisha#1 said...

I understand how the search for a good contractor can control your entire destiny as a rehabber. You pretty much have to work with whatever help you can get sometimes. But, Shaun, did you get other bids before deciding on this contractor? It would be wise to do so.

monarchcrest said...

I second what Trisha said, you never mentioned getting any other bids. The price sounds very high to me also.

I can ask my friend who is a contractor and does remodels, and is also on the richdad forums if he'd like to bid on your house.

I hate to tell you this, but what you are typing is very similar to what you typed before your first remodel. Go back and reread your posts and see if you see any similarities.

Shaun said...

No, I did not get other quotes for this project, mainly because I have used this contractor in the past for work on my personal residence. At that time I did get other quotes for the job and he was comparable. I will concede, however, that that was two years ago...

I suppose the problem is that I always want to rush to get the rehab process started. That's probably not always a good thing.

Monarchcrest - I've already hired this guy, but for the next rehab, I'll be sure to get a quote from your friend. And you are right - there are similarities between what I am doing now and last time. Last time I stuck with the same handyman even though I knew he was slow because I wanted to get the job started right away. It seems like a clock in my head starts ticking the moment escrow closes.

Perhaps if I was spending my own money instead of my investor's, I'd take a closer look at this. That's a character flaw I'll need to work on. Actually, I'm living proof of a concept discussed in the book Freakonomics - that real estate agents generally don't try to get the highest price for their sellers because the increase in their pay from it is too small to make it worth the effort. I only get a percentage of the profits from this property. If I got 100% of the profits, I'd probably be getting more quotes.

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