Everything you need to know about insurance basics, like coverage types, limits, cost and more.
How To Find Contractors for Your Rental Property
When work needs to get done on your rental, you’re going to want seasoned pros to get the job done quickly and efficiently. If your goal is to keep your vacancy days to a minimum, you’re smart to find the best contractors available. Take a look at these tips to find great contractors.
Study Your Contractor's Credentials
Before you start a search for your team of experts, make a list of typical maintenance issues and office concerns that you may need to outsource. By carefully selecting who you work with, you’re likely to have a more reliable finished product.
Work with licensed professionals. Licensed contractors are more familiar with local building codes and there's a higher probability that they've been trained and tested in their field. That can help you be confident that they’re working in line with residential building codes and requirements. And when the inspectors come through to check the work, you'll find fewer work stoppages because the contractors are licensed to get the job done correctly.
Be sure they’re bonded. With so much riding on the success of your rental unit, it’s a good idea to require that your contractors are bonded. If the contractor fails to meet their contractual obligations, the bond can be used to secure your funds to complete the project or repair damage caused by the contractor. Be sure these credentials are up-to-date before signing.
Get a guarantee. Because you’ll have tenants residing in your rental space, you’ll want to be sure you’ve got a written warranty on the work being done. In case repairs or adjustments need to be made afterwards, you’ll be covered financially and legally.
How to Search for Contractors
There are a lot of ways to go about searching for your team of good contractors. After you’ve identified several groups that qualify by being licensed and bonded, take your search to the next level and dig into each company’s profile and financial data.
Much like the work you’d do for tenant screening, vetting your potential contractors will mean you gather information to get a complete picture. Here’s what you’ll want to do next:
Look online for reviews and feedback. Enrolling in subscription services like Angie’s List and Thumbtack can open your eyes to a wide range of qualified candidates. With reviews, ratings and personal statements from the reviewers, you’ll find usable information to help you make an informed decision.
Throw out the door-hanger solicitations. The companies seeking your business this way are usually not busy for a reason. The real experts you’re seeking will be hard to find, and harder to book.
Ask around. Once you’ve selected a few qualified candidates, ask other landlords and property owners with rentals like yours who they turn to when they need contractors. When word of mouth recommendations point you to a candidate you’ve already got on your short list, you’re off to a good start.
Book a face-to-face. You’re an employer, hiring an employee. Because you’re going to want to see who these people are and if you can trust them, there’s no better way than interviewing the contractor.
Ask them to bring project portfolios and before/after pictures to the meeting. Also request former client estimates and end-of-project actual cost documents.
Get references. Request three or four phone numbers of former clients for you to contact. Be sure that these clients had work done similar to the project you’re hiring for.
Learn about the contractor’s reliability and the lasting quality of the finished product when making phone calls. Did they complete the work on time? Ask the client if they would hire that group again, as well.
Vet the contractors. You can find a lot with a simple internet query. Search online for lawsuits filed against the group and look at the company’s status on the Better Business Bureau’s website. Remember, these contractors will be in your tenant’s rental so you’re going to need to trust them.
Run a credit report. Once you’ve made your selections, get online and review the candidate contractor’s credit history. Are they mired in debt? Have they filed for bankruptcy? Does their financial profile look stable?
Groups like Experian and Dun & Bradstreet offer services that will deliver details on the contractor’s payment history. And some will offer data on recent trends that may indicate financial trouble in the near-future.
Get multiple bids. Once you’re satisfied with the feedback you’ve gathered on three or more contractors, it’s time to get quotes. Ask if they accept credit cards for deposits and payments. Compare timelines from these quotes and make a decision that factors in price, projected unit vacancy time, quality and warranty.
Hire a Reputable Property Manager
If all of this is feeling like it’s too much to manage, consider outsourcing now. There are several advantages to letting property management companies source your contractors and manage your projects. Here are a few important reasons why hiring a reputable property manager may be the best option for you:
They’ve already made the connections. Because working with general contractors is something these groups do every day, they’ve built reliable, long-term relationships with local trades. And the contractors are more likely to perform according to the terms in their agreements because property management companies provide a steady stream of business for them.
Property management groups can negotiate better rates. Larger, established management companies may have the ability to negotiate on your behalf better than you may be able to. Landlords new to the industry will sometimes be unaware of rates and pricing, but property managers know how to price out projects and vet an estimate.
Some repairs and maintenance are included in the monthly fee. Ongoing maintenance contracts with landlords can include a flat fee for upkeep and repairs, up to a certain price point. By hiring a property manager, you may be able to save on small jobs which can eat up your time and finances if you were to take these on independently.
Inform Your Agent of Property Upgrades
Before you start remodeling or hiring a contractor to work on your property, you may want to revisit your current landlords policy with your American Family Insurance agent. When you renovate a rental, you’re often increasing its value and increasing the cost of repairs in the future.
It’s a good idea to boost your commercial umbrella liability policy limits so your real estate investment will be protected while the project’s under construction and once it’s complete. You’ll be more comfortable knowing your investments are insured carefully — giving you the freedom to focus on growing your business.
Related Topics: Business Growth , Digital , Landlord , Property Management