Fixer-Uppers: Project Management 101

Your goal in real estate investing should be to make the most profit in the least amount of time using as little of your money as possible. Buying fixer-uppers and renovating them for resale is an excellent way to increase your profits. But how do you avoid becoming a renovator and losing sight of your investment goals?

You must focus on becoming a project manager. Project management puts you in the position of making sure the renovation gets done instead of doing it yourself. Project management for fixer-uppers will include finding subcontractors, getting quotes and scheduling the work.

Know What You're Getting Into

Your agreement with the seller should include access to the property so you can complete inspections and uncover any hidden problems. It's best if your agreement allows you to re-negotiate the price or even nix the deal if major problems are discovered.

Be Flexible

When starting any fixer-upper renovation project, realize that the process may not go as smoothly as you expect. There will always be unplanned delays and unanticipated obstacles. Keep your schedule flexible, allow for some extra time, but work to minimize any delays that do occur.

Let the Professionals Work

It may seem like doing the work yourself will save money. This may be true if you're working on your own home. But when you are renovating a fixer-upper for resale, everything you do must pass inspection and conform to local building codes. Are you sure enough about your skills to meet these requirements? You're usually better off to start with a professional subcontractor rather than trying it yourself and then paying to have it done over.

Hire Qualified Contractors

When hiring the pros to do your renovation work, ask for references and check them out. Ask yourself if you can develop a good working relationship with the contractor. Don't rely on a handshake for your business agreement. Draw up a document that spells out what's expected from both parties.

Create a Work Schedule

To renovate your fixer-upper most efficiently, you'll need to put together a work schedule for the subcontractors. Keep in mind that some jobs need to be done before others. Remember, subcontractors don't always show up at the time or date you've scheduled. Make sure you allow for this so that one late worker doesn't wreck the entire project.

Don't enter into a renovation project without a budget and a set of priorities. Hire qualified subcontractors and let them do their job. Make sure the work proceeds according to schedule, but expect the unexpected. Efficient project management of your fixer-upper renovation will pay off in extra profits when you get ready to sell.
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