Your general contractor can make a massive difference in the profit or loss you may take in your real estate efforts. Whether it’s a fix and flip, a BRRR, or a rental property, this is a big deal. Finding a good contractor with reasonable prices, quality workmanship, who shows up and does what he’s supposed to is a task, especially if you’re just getting started.
So we’re going to talk about ten different ways that you can find these contractors and make sure they’re going to be good ones.
Now, keep in mind with all this, you don’t have to start over every time. If you get good relationships with contractors, they are worth their weight in gold, so hang on to them when you find them.
Method 1: Home Depot Stalking
At Home Depot, there’s a contractor’s desk that’s designed to help general contractors get the stuff they need quickly. You can go to Home Depot, typically in the early mornings, and see contractors coming and going. Sit in your car and wait for pickup trucks to pull up that have phone numbers on them, then call the number.
Be careful when using this advice—you don’t want to call the expensive, new pickup trucks. Instead, look for a beat-up truck that’s a few years old; you’ll probably get a better deal from them.
You’re going to call each of them and say, “Hey, I’ve got a job in the area; here are a few details. Would you be interested in it? When would be a good time to come take a look at it?”
Be warned that if you let them know you are watching or calling them, they may think you are a psycho. The best thing to do is be kind of hidden and call them without giving away your location.
You can tell a lot about a contractor by how they answer their phone. If they pick up right away, that’s a good sign they’re on-site and doing the work themselves.
I prefer to work with general contractors who have a smaller number of teams. I want to work with a general contractor who is on the job and has a few helpers or other guys there with him. I like this because it typically results in better communication and coordination.
So to recap: Home Depot stalking is simply going to Home Depot and sitting there, calling every person that comes by with a decent (but not great or incredibly expensive) truck and asking if they’d be interested in the job. If you sit there for a few hours, you’ll find some great contractors.
Method 2: Contractor’s Desk at a Home Improvement Store
So as I mentioned above, there is a desk for contractors at Home Depot. This is typically where you can pull up, and they will bring out supplies and load them on the truck.
You should walk into that entrance and then to the Prodesk or contractor’s desk. Once you’re there, you should ask the person working the desk for recommendations on great contractors.
This is a great way to get referrals because the people working this desk see many people coming in and out of Home Depot and can vet some of them, at least at the surface level (which can still save you some time). Try to make relationships with some of these people and get referrals for contractors or other services.
Method 3: Apartment Associations
If you’ve never heard of one, an Apartment Association is typically a group of landlords or apartment owners who come together to advocate for their interests and ensure that laws affecting them are not passed.
Do not be alarmed by the word “apartment”; these associations aren’t that strict. The idea is simply that people renting properties are part of the same community.
Here’s the scoop. Often, apartment associations or landlord associations will have people sponsoring or paying to be included in their directory. People like contractors.
Why would anyone want to work with a landlord if they’re not getting top dollar? Statistically, contractors who work with homeowners are more likely to get paid more. Typically, the guys who work for homeowners run ads on YouTube or Google or have big billboards or expensive trucks with extensive advertising.
However, working with Apartment Associations might not make them as much money, but they save on the backend by not needing those billboards, YouTube ads, and expensive paint jobs.
Instead, they get repeat business without the marketing overhead. So look up your local apartment association or landlord Association, and see if there are people on there as sponsors or part of the directory.
Method 4: Licensed Contractor Databases
The fact of the matter is that every general contractor is licensed or has some type of license in most municipalities. Those licenses are matters of public record, so you can use public information to look up permits and get a list of all the licensed contractors in a specific area. These license registries typically have each licensee’s phone number and address.
You can pick up the phone and say, “Hey, I’m looking for a good contractor. I’m a real estate investor, and I have lots of projects. I’m looking for somebody who is trustworthy and does good workmanship at reasonable prices. Is that something you’d be interested in working on? If so, can we schedule a time for you to come over and look at the property?”
How many people will you have to call before you find someone willing to do the job? It’s typically about 20 calls to get a couple of people to come to the property before one of them actually gives you a bid.
Method 5: homedepot.com/services
The next thing I want to discuss is returning to Home Depot. If you go to homedepot.com/services, they will provide you with names of contractors from their database who can come out and give you bids.
Now, they’re usually more expensive. They’re not going to be as expensive as the guy with the giant pickup truck, but they will be more expensive than the guy swinging the hammer. This is still a good option if you need one in a bind.
Method 6: Supply Houses
Supply houses are places for tradespeople in the industry to get materials and supplies. You might try asking a supply house for recommendations on good contractors, or you can do the same stalking you tried at Home Depot; watch customers go in and call the numbers on their trucks.
Method 7: Craigslist
You can find general contractors on Craigslist by looking at the classifieds section. There, you can see people who are actively seeking work.
I need to make sure that I’m looking at quality and other factors because I don’t know these guys. But that’s pretty much the case with anyone we’re talking to right now.
Method 8: Real Estate Investor Facebook Groups
I’m not a big Facebook user, but there are investment groups for all kinds of things, including real estate. So you can search for a state or city real estate investment group, and you’ll most likely come up with something.
Now, it’s important to remember that most of these groups have rules against spamming and selling services. So, you’ll need to join and get approved before starting posting.
Once you’re approved, post in the group and see if anyone has any recommendations for GCs. You could also look through the list of members and see if any of them are general contractors themselves. You could then reach out to them directly with a private message or phone call.
Method 9: Thumbtack
Thumbtack has an application where you can specify the task you need to be completed, and it will provide you with a list of people who can do the job or who will contact you to get the job done.
Just be mindful. There are people on there who will charge you a lot of money, but there are also reasonable people. So be careful not to go the wrong way.
Method 10: Angie’s List and BuildZoom
BuildZoom and Angie’s List are similar in that they’re basically aggregators. With Angie’s List, you pay for a subscription where you’ll get access to lists with contractors’ information and other people’s reviews. I find that typically they’re a little more expensive, but it might be something to consider in a pinch.
BuildZoom is a place where you can put in your information, and then they will line you up with some contractors. BuildZoom works a little different than Angie’s List, though, because it will be getting a cut of the overall job, which means you’re probably paying a little more. But these are very fast ways to get people to come and make bids on your construction projects.
A Few Tips on Working with Contractors
You’ll need to be proactive and follow up with them regularly – calling or texting every day and emailing them. My rule of thumb is I call, text, and email twice a day for three days.
I’m not trying to be aggressive, but I need to get things done. I don’t want to waste any time because it could cost me money or kill a deal. So I’ll follow up with general contractors as much as possible until the work is done.
Ask for Referrals
The other thing to keep in mind is to always ask for referrals. Don’t give up if you talk to someone and say they’re not interested or too busy. Instead, ask if they know anyone who might be interested or who would be a good fit for what you’re offering.
Always, always, always, always ask for a referral. If you’re getting off the phone and haven’t asked for a referral, you have not done your job.
How Many Contractors Should I Talk To?
How many contractors do you have to talk to before finding one good one? According to US News, you have to find at least five contractors to come to your job before you find one good contractor.
Home Advisor also recommends you should get ten contractor bids. Dan DiClerico, a smart home strategist and home expert for Home Advisor, recommends reaching out to as many as ten contractors and getting detailed conversations and estimates from at least five of them to help you feel confident enough to make a decision.
How Many Bids Do I Need to Get?
The question, then, is how many bids do you need? Fox Business says you need three contractor bids before starting any type of construction project. REI/kit says you need three to do a fix & flip or other real estate investment.
In my opinion, at the very least, you’ll need three of them, but preferably more. Two is the bare minimum, but you should aim for three if possible.
Why do you need so many contractor bids? It’s simple: there is no MSRP or sticker price when you’re remodeling. You have to negotiate with the contractor to get the best deal possible.
Prices fluctuate due to supply and demand. But they’ll also vary depending on the contractor’s mood and workload. This means you need two or three different data points to decide. You won’t know what’s going on unless you compare prices from multiple sources.
Think of getting contractor bids as part of your education process. This will help you understand what the property needs and interview real estate general contractors because you will know what to look for in a contractor bid.
So how do I get two to three bids with contractors going on the project? To get two to three bids from contractors, I need to ask four to six contractors to come to the project.
There are many reasons for this. Some contractors never show up or provide bids. Others may not want the job because it is too big or too small. Some contractors don’t seem like the right fit, even though you can’t put your finger on why.
When determining how many contractor appointments you need to make to get them to show up, it varies depending on where you’re getting your leads.
If you’re getting a contractor lead from a friend or somebody you know, or a real estate investor, it’s more likely that the contractor will follow through. But if you’re calling general contractors from a database or the municipality of licensing, it’s less likely that the contractor will show up.
I typically like to set between six and eight appointments, knowing that some may not show up. This usually leaves me with four showings and hopefully two to three bids.
But when I set these appointments, I usually start with a few pre-screening questions like:
- Is this stuff you can do?
- How fast can you do it?
- Are your prices reasonable?
- Are you sure you’re going to come?
- What do you think it’s going to cost?
- What’s the average square foot you have other jobs that you’re coming to look at?
I’m doing that to lower the risk of having no showings. So, it just depends on where you’re getting your general contractors from. But, just keep in mind that you’ll be setting appointments, and some people won’t show. Also, some people will show up and never get you a bid, or you just may not want them to bid.
Planning ahead for this is essential; the worst thing you can do is wait to see what one general contractor says. Getting multiple general contractors on the project as soon as possible is vital.
Okay, I’ve Got My List of Contractors; Now What?
If you’re looking to get five or six general contractors, what’s the best course of action? Should you schedule them all at once? Or stagger the appointments?
You should meet with potential contractors as soon as possible to avoid delays. The sooner you can meet with them, the better. If you can, see the property with one contractor and try to get another to come over the next day.
I wouldn’t recommend having all the contractors there on the same day. And at this point, I don’t think you should tell them you’re getting multiple bids. I think you should just say you want to get a bid, and that’s that.
Then, once you’ve gotten multiple bids, you can compare them and start to have some conversations. But at this point, you want everyone to be excited about getting the job. But if you start saying, “I’m going to give the job to somebody else, but I need you to come out and look at the property,” nobody will show up. There needs to be that motivation that they can potentially get that job.
What if I Can’t Find a Contractor?
If all of your previous attempts have not been successful, your next step should be to compile a list of licensed contractors and call every one of them until you find one that is willing to take on the job. Keep in mind that you may have to call 20 or more contractors before you find one available.
There’s a chance you’ll have to call around 80 to 100 contractors to find a good one, but it’s worth it to avoid overpaying or finding someone who can’t do the job correctly. A single phone call could save you thousands of dollars in the long run.
These are ways to find contractors fast and make sure you’re getting enough of them to make your job successful. Remember, time kills every deal, so aggressively follow up and stay proactive.