Before
After
We chose to replace the counters, cabinets, and floors in this rental with brighter, more modern materials that can withstand damage and are easy to clean. We opted not to install floating or open shelves, both of which are trending for 2022, because they do not maximize space and are more easily damaged than traditional cabinetry.
ELEMENT #2: ROLESAND RESPONSIBILITIES Once investors identify a project’s purpose, they must identify who will be responsible for various parts of that project. In a rehab project, this is where communication with contractors comes into play. Establishing clear expectations for how and when different parts of the project will be completed (and paid for) as well as determining precisely who will handle working with inspec- tors and getting all the permits in place will help the project progress smoothly. Without clear expectations and communication between inves- tors and contractors, there cannot be a successful rehab project. IMPLEMENTATION TIP It is unrealistic to expect a contractor or any other party to perform reliably and responsibly if you don’t also demonstrate you will behave in a similar way. In addition to telling your contractors what their roles and responsibilities will be, ask them what they want and need from you. Both parties likely will have preferred methods for making payments and draws on the budget, for example. You will get the best results if you
relationship with your contractor and then craft an operating process that works for both of you.
be accounted for in a trackable, predictable, repeatable way. Payment processes, punch lists, delivery of the final payments to the contractors, delivery of materials, accounting for materials, etc., all involve processes that should be standardized across all projects to streamline the entire rehab. Many investors have no idea that a clear modus operandi would eliminate most miscommunications between themselves and their contractors—along with much of the financial waste associated with their rehabs. •
ELEMENT #3: ENCOURAGEMENT (AND EXHORTATION) Contractors should be both
encouraged and exhorted to finish projects on time, under budget, and with sterling, quality work. The best way to do this is to provide a clear- cut system of rewards and penalties, usually financial, to create account - ability for both the contractors and the investor on the project. When everyone is motivated to get the job done right, the job gets done right! IMPLEMENTATION TIP Plan weekly check-ins with your contractors. Regular meetings not only increase accountability, but they also foster rapport and enable you to confirm the project is still on schedule. The easiest way to develop this rapport even more quickly is to bring coffee or another easy “treat” with you to these meetings.
Instead of simply diving headfirst into your vision for your next rehab, take the time to PREP. You will find the financial rewards—not to mention a happy,
speedy contractor delivering high-quality service— are far more rewarding than good pictures you can post on social media. Tom Olson is the founder and president of Olson Group Network, which includes Conduit Capital, Olson Group, Olson Property Services, Olson Construction Management Services, Sarah Jo LLC, and Good Success. He is the author of multiple popular books for entrepreneurs and investors, including “The 30-Day Good Success Journey,” “Active Turnkey (The Best Way to Buy Rentals),” and “Investors vs. Contractors.” Olson also hosts the “Good Success Podcast” and the “Active Turnkey Podcast.” The Olson Group Network will host a free real estate event Sept. 30-Oct. 20, 2022, in Gary, Indiana. Learn more at BuyOlsonGroup.com.
ELEMENT #4: PROCESS A rehab project has a lot of moving parts. Every one of them should
ask up front how you can best establish a long-term, working
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