Remodeling Contractors – Working with Distressed Real Estate
I have been writing for several years now about how to be more successful in the remodeling industry. With over half of the nation’s homes being built prior to 1980, there will always be a remodeling industry because homes around the country are aging just like we are. They will continue to need work, love, and attention. Remodeling is a good industry, and anyone reading this will usually share positive stories from their experience while working in this industry. It is fulfilling work, but it doesn’t build wealth.
Let me explain what I mean. Several years ago I was speaking with a very successful remodeling contractor who had begun rehabbing old homes, keeping some, and selling some others. He had been doing this since the mid-nineties, and I was curious about this. I asked him why. With a successful remodeling company, why was he rehabbing older homes. With a smile I’ll never forget, he looked at me and asked me a simple question – “how many rich remodeling contractors do you know?” The reality was that I didn’t know any rich remodeling contractors, and told him so. His response was that I probably wouldn’t ever meet a rich remodeling contractor because remodeling doesn’t build wealth. It’s a good business, but remodeling contractors create wealth for the homeowners they work with. Homeowners receive the long-term value that comes from a well-executed remodeling project.
As a result of this conversation along with some others, this gentlemen became a bit of a mentor to me. He begin to show me the value of working with real estate. He said to build long-term wealth, remodeling contractors needed to buy, rehab, and keep real estate in their own account. Historically, real estate values will go up, so if you hold on to properties over a number of years, you have built a successful retirement strategy. His advice was simple – buy and keep at least one house a year for 10 years. That was it. You can fix and flip properties for cash, but keep at least 1 property a year if you want to build wealth. If you keep one house a year for 10 years, you will replace your annual income with the cash-flow coming from your rental properties.
I know several remodeling contractors who are doing this now. They have the skillset to do this successfully. With their remodeling skills, and the relationships they have with trade contractors and suppliers, they have the ability to work on a wholesale basis in real estate. You have the same ability. You have a skillset that 95% of real estate investors don’t posess.
With that in mind, I’m working with a former contractor named Bob Tierney, and we’ve created a program for remodeling contractors called the Contractor Stimulus Program (www.ContractorStimulus.com). The basis of working successfully with real estate is education. It’s learning how to find, finance, rehab, and then sell or keep the real estate you have purchased. Bob is part of an active real estate community in the Chicago area, and he set-up a day a few weeks ago to both tour and video 3 projects that a community member was rehabbing. Here is his note:
3 Video Tours of Active Property Rehabs
I spent the day last week with one of our community members who in the past few years has completed over 50 rehabs, the last one profiting over $131,000. Gary is currently working on 6 properties and I got the chance to go see 3 of them personally – and I brought my video camera with me so I could share them with you!
This is AS REAL AS IT GETS – Click on the houses to view the videos – www.ContractorStimulus.com/rehab-tours
Here is the kicker – Gary is not even a contractor by trade (which means you have an advantage because of your skills & experience). The videos are in HD – so if when you watch them they are a little choppy then pause the video and let it load for a few minutes, they are large video files and need a little extra time.
I am really excited to be able to share these real-life examples of people who are completely changing their lives. Gary was down and out, completely broke with trashed credit just a few short years ago. He and his wife have now just finished building their dream home (a unfinished new home that went into foreclosure from a bankrupt builder that they bought for a song) and moved into it in December 2012.
Please take some time reviewing these free videos! (Please excuse the not-so-professional ‘verbiage’ on the last video – we had to crawl into a window and let’s just say it wasn’t real pretty ?