Run Scared From Collapsing Basement Wall?
Nice property on a nice treed lot; great kitchen, nice space..........drawback on this one is a collapsing basement (dirt cellar in actuality) wall.
The wall is brick and is crumbling inwards; heavily in two seperate areas; you can tell where bad grading is one of the main problems as it looks like a small flood has taken place in that side of the cellar; the furnace is even up on blocks showing signs that the water has been a problem for some time.
So is this something that anyone else has taken on? I imagine the wall should be replaced with cinder blocks and the dirt cellar should either have a concrete floor put down or the furnace and water heater should be moved to the main floor.
Any experience with this would be great to hear about; the profit on this property relies on the $cost$ of this fun repair 
How experienced are you at rehabbing??
I completely agree with Rehabinator.
But I might suggest… if you decide to pay him extra on this one, you should make it clear that in the future, if something is not on his original scope of work, or is going to cost more, he needs to let you know before doing the work – not after the fact.
I just went through this on a rehab, and it came up several times with a couple of different contractors. Things they said they were going to do weren’t on their contract. So, they had to change the contract before they started. Or, additional things that came up during the rehab, and we agreed to a price before they proceeded. Or, inflated billing when nothing had changed, so they had to reduce their billing.
It may sound weird, but I’ve been known to pay more that the contract amount. Or, I oftentimes tip the work crew for exceptional effort or an exceptional job.
My 2¢
Sorry all,
Let me clarify. When I say friend, I mean person I have talked to alot and know well.
He is his own company and wrote out a complete contract stating pricing and work to which we signed and I paid him half up front on.
Does that change anything?
[addsig]
Makes perfect sense and that is probably what I will do if he wants to continue working with me on projects in the future.
Best,
[addsig]
I would have to know what the extras are to really answer, and as a contractor and investor may need to see it.
But if it was a hidden proplem or not resonable to foresee then you pay. Such as termite damage, bad wiring etc...
If he just underestimated time or materials or should have known then he pays.
If you dont know enough about construction yourself get a list of the things and run it by a decent contractor to get an opinion if it was hidden. Even if you have to pay him $40.00 to just look over the list.
That is why most ad in agreement any extras to be approved in writing. So they can be looked at and discussed as they come up.
Too small a margin for a rehab. How long will it take to fix and sell? What are your payments during this time? What is the value of the cash you put in to it during this time? I would think the holding costs alone could eat up most of the potential profits.
Chris