THE BLOG

Know All the Costs Before you Proceed with the Project #76

Hi, my name is Lou Brown. I’m here with another of my 101 cash flow accelerators.

And in this one I want you to be aware of what your costs are when you’re doing renovations. I know that sounds simple and uh, but it’s really not. A lot of people really don’t understand what they’re going to spend when they go into a project. Often, actually, as an investor, I buy from wholesalers all the time and one of the things is they bring me projects that are failed projects. Why? Because the unknowing untrained investor came in, purchased the property, started the renovation, ran out of money, got taken advantage of by the contractor. Didn’t know what to do, didn’t know how to do it, crashed and burned. Brings me the deal. I buy it for pennies on the dollar. I’m able to finish the renovation. It’s something you need to be very aware of, particularly if you’re just getting started in the business.

(more…)

April 17, 2020, By Lou Brown

When in Doubt Get a Professional Opinion #77

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow accelerators. I want to help you to be successful in this great business called real estate.

And one of the things that are very, very important is that you identify when you don’t understand what it is that you’re doing. For example, you may think to yourself that you are supposed to do something, and I’ve seen too many times when people buy carpet when they need to be buying drywall and they bring things to the project that’s untimely for where the step is in the project. So critical that you have deliveries related to the installation of those things. The reason is that contractors and their workers are often very sloppy. Careless, it’s your materials. They don’t care about those things. And secondly, theft is that it’s easy to take something that’s right there on the job. I hate to tell you this, but some of the people working on the job might be the thieves or they might tell someone else, Hey, I know some stuff that’s on that job over there.

(more…)

April 17, 2020, By Lou Brown

Know your market and the type buyer you will have and renovate accordingly #78

Hi it’s Lou Brown. I’m back with another of my 101 cashflow generators where you can make more money and less effort in a single bound.

(more…)

April 17, 2020, By Lou Brown

Always have a budget #79

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow generators, planning for you to make more money with less effort. This is a great one and it is always has a budget. You know, a lot of people jump into a renovation. They really don’t know what they’re gonna do or how they’re gonna do it. They just decide along the way, which is a really bad plan. So my advice is to do your homework, design the house the way with the end in mind. Always know what materials you’re going to put into it and how much you’re going to spend, otherwise, you can spiral out of control. I’ve watched many people crash and burn. You know, they watch TV, they think that they are now in a renovation business. It looks so easy. It’s amazing how they’re able to do all of those months of renovations in just half an hour, isn’t it? And many times you can see the pain and suffering that people go through in their renovations. Way overspend, tear out things they shouldn’t have torn out, and really not taking advantage of the fact that you need to be making a profit.

(more…)

April 17, 2020, By Lou Brown

Give the contractor a bonus #80

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow accelerators to help you be more successful in your real estate business. You know, renovations, I’ve done so many of them. I used to do entire neighborhoods. I’m very familiar with turning things around, and one of the things you gotta deal with who can help you make a lot of money is your CONtractor, right? I’ve made jokes about the word con being in contractor because you definitely have to be on your toes. You have to know that the deal can change at any moment in time, and if you’re not alert to it, they can actually get over on you. Always have a CONtract when you’re dealing with CONtractors, always know exactly what the deal is. Who’s going to be responsible for what. And if you don’t, I promise you, you’re going to have some pain, suffering, and expenses you could have avoided. Now I’ve got an independent contractor services agreement. It took me years to work through that and come up with a plan that absolutely works. It’s in my volume 11 renovations. You can find that at StreetSmartInvestor.com under tools, click on renovations, volume 11 you can learn more about that. Hopefully, this has been helpful. Like it. Love it, Share it, and I’ll see you soon. Yeah, baby.

(more…)

April 17, 2020, By Lou Brown

Charge the Contractor #81

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow accelerators to help you be more successful in your real estate business. In this section we’ve been talking about renovations and boy I tell you what, I’ve done a bunch of those. I’ve done a whole subdivision and it’s been really interesting to learn about working with contractors and getting them to behave the way you want them to. “Oh, Behave!”, as Austin Powers would say and they won’t unless you penalize them. Well in my contract it’s called an independent contractor services agreement. It’s available in volume 11 renovations under StreetSmartInvestor.com. One of the things I have is a contract for the contractor and an important thing to have in there is penalties when they don’t complete on time. So typically we go through a list of things that need to be done. I provide that to them.

(more…)

April 16, 2020, By Lou Brown

Have the contract state who handles the construction debris #82

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow accelerators. Renovations can absolutely accelerate your profits. However, there are things that you must consider. One of the things that I’ve laughed about over the years, I’ve learned in doing many, many renovations is that when you’re dealing with the contractors, you better have it clear who is going to be responsible for the debris cleanup and removal from the property. We have it built into our independent contractor services agreement to be sure, and by all means that they are going to be responsible for that and they will not get their final check until all debris has been not only cleaned up but removed from the property. I hope that’s been helpful to you. It’s really, it’s been a challenge in my life for sure, and I want to make sure it’s not a challenge in yours. If this has been valuable, like this. Love this. Share this and I’ll see you soon. Yeah, baby.

(more…)

April 16, 2020, By Lou Brown

Have the contract state the crew size #83

Hi, it’s Lou Brown. I’m back with another of my 101 cash flow accelerators to help you accelerate the cash and your business and one of the things that I’ve always learned is that when you sign a contract with the contractor, you better be sure that you say when they’re going to get that job done. Not only that but what makes us think that’s going to happen? How many crew sizes are they going to have on the project and what times of the day can you expect to see them there? So in my independent contractor services agreement, I’ve actually built in when they have to be there X number of days per week and during the hours of X and Y to be sure that I can expect to see them, I can drive by at any time and see them and know that the contract is being fulfilled and that my job is going to be done on time. What is typical is that contractors run on to another job and another job and another job. They get deposits from a variety of different people and they go start working on all those different projects, tearing things out, and getting them, the owner pretty much committed to them to have to finish the project. While I’ve been very careful to make sure that they’re going to get on my job, stay on my job, get my job done. Well, hopefully, that has been helpful to you. You can find out more about that at StreetSmartInvestor.com click on tools and click on renovations, Volume 11 and I hope this has been helpful. Like it. Love it. Share it, and I’ll see you soon. Yeah, baby.

(more…)

April 16, 2020, By Lou Brown

Have the contract state the minimum hours required to work #84

Hi, this is Lou Brown. I’m back with another of my 101 cash flow accelerators to help you build your business, grow your business and support you long term in the success of your business. One of the things I’ve learned over the years in this section, we’ve been covering renovations. You better make sure you know the number of hours that they are going to devote to your business. And so therefore in our contract we actually state the number of hours that they’re going to devote. One of the things when you are first determining whether you’re getting a good deal or the right price from the contractor, I always ask them, well, how long do you think that will take? And then as we’re going through the contract, you know, how many hours would that be and how many hours would that be and how many hours would that be? And then I’ll do my own calculations on the number of hours I expect it to take.

(more…)

April 16, 2020, By Lou Brown

Understand exactly what is included and what is not #85

Hi, it’s Lou Brown. I’m back with another of my 101 cashflow accelerators to help you be more successful in your real estate business. Well, make sure that when you are dealing with a contractor in this section, we call this renovation or success or renovating for success. Let’s be sure that we not only enter into a contract with the contractor, but we know exactly what they’re going to do with that contract. Now what I recommend is you actually do your homework and that means go through the property yourself, not with the contractor, I mean yourself, and literally break it down. What do you want to be done in each room and what do you want each trade to do in each room? So what I did in my renovation system, volume 11 what I did was actually determined each one of the different trades and then determine what they would do in each room.

(more…)

April 16, 2020, By Lou Brown