Keeping your reno on track – Patrick Bright

Keeping your reno on track – Patrick Bright

 

According to real estate author and buyer’s agent Patrick Bright, the easiest way to keep a renovation on track is to ensure all the tradespeople do their work in the right sequence. He has some tips on getting the sequence right in a way that may just save your thousands of dollars.

 

Transcript:

Kevin:  The easiest way to keep a renovation on track is to ensure that all the tradespeople do their work in the right sequence, but what is the right sequence? We’re going to tap into that now and talk to Patrick Bright from EPS Property Searches, also the author of The Insider’s Guide to Renovating for Profit, and if anyone should know, he should know.

Good day, Patrick. How are you doing?

Patrick:  Good, thanks, Kevin. Nice to speak with you again.

Kevin:  It’s a bit of an art, isn’t it? Many people see renovation as a quick way to make a dollar, but there are also a lot of ways you can go wrong if you get that sequence wrong.

Patrick:  Yes, and it costs you money if you don’t get a number of things right. The sequence of tradespeople is always an important one, and something that I notice people… So when you’re looking to do a renovation, it’s a good thing to always ask the tradespeople how long they’re going to take, ask them which trades do they follow, and ask them which trades follow them. That way, you’re not going to have people going in over the top of each other or having to redo work or fix up work and have people come back.

Kevin:  We’re going to talk in our conversation with Patrick exactly how you take that information and use it, but let’s just go over those questions once again. The first one was “How long will you take?”

Patrick:  Yes.

Kevin:  Second one was “Which trades do you follow?”

Patrick:  “Which trades do you follow?” and then “Which trades follow you?”

Kevin:  And the only reason you’re asking those questions… Good tradies would be able to answer that, wouldn’t they? If they looked at your plans and they knew what you were going to do, they’d say “Well, we fit into this part here.” Is that right?

Patrick:  Yes, correct. And some trades – like your plumbers or electricians, for instance – they might have to come in and put some pipework or some wiring in and then come back and finish off. There are some trades that will have multiple visits, but you need to know when they’re coming. That way, they’re not having to work over the top, or it makes their job easier.

If all the walls are, say, sheeted out with Gyprock, and then you have the electrician coming on, then they actually have to chase wires through the wall. It can be done, but it just takes a lot more time, marks things up a little bit, and you’re going to pay more money, and you’re going to have to have them come back.

Kevin:  So once you have all this information, then you put that into a spreadsheet and format the whole thing in terms of dates?

Patrick:  Yes, that’s pretty much right. It’s just using a simple old spreadsheet – nothing too complex – and then you just put the types of trades and the work that’s being done in a logical order, and then put the dates so that you have an estimated timeframe. That way, you know how long they’re likely to take, and that way, you’re going to have people dovetailing in behind the other.

Kevin:  Okay, so the first question was “How long you’re going to take?” You mentioned about a buffer, how much of a buffer should you allow around each person?

Patrick:  It depends on the trade. I allow 10% buffer, so if they’re saying they’re going to be a week… I’d put at least one day in-between any trade unless they’re less than a day’s work, but if they’re going to be a week or two, you might want to put in an extra couple of days as a buffer – but a, say, 10% or 20% rule of time. You have to allow for weather and things like that, as well, depending on the type of work that’s being done.

Kevin:  Yes, because those things can throw the whole sequence out, can’t they? I suppose you have to advise the trades that “While I’m giving you some dates here, these dates need to be flexible, as well?”

Patrick:  Exactly, yes. And you’re better of having a few days’ buffer and then ringing up the trades and say “Hey, look, the Gyprocker has just finished.” You ring the tiler and say “Mate, do you want to come a bit earlier?” Something like that is better than “Mate, I have to push you back a few days,” because then that’ll push everybody back, and they’re usually running from job to job.

Particularly in this market, I find – and have for years – good tradespeople really are busy, and they don’t have a few spaced days to space things out for you, so you need to book them in and keep that schedule running.

Kevin:  Yes, so once you’ve made the dates, set them out on the spreadsheet, you then book all the tradies in in advance, rather than just ring them a couple of days out. How far out do you normally book them, or how far can you book them, Patrick?

Patrick:  Weeks, if not months sometimes. I run a lot of rental projects, I’m doing a few a month, always on the go for clients who we’re managing. Most people will take, for example, about 10 to 14 weeks to, say, renovate a two-bedroom apartment. That’s completely gutting it, from start to finish. I’ll do that in about six, maybe eight weeks tops, depending on weather and things. You can do a lot quicker by being efficient, and I will book those tradespeople in sometimes six, eight, ten weeks in advance.

Kevin:  Once we have all this nailed down, from your experience, where do you see most amateur or first-time renovators go wrong?

Patrick:  From a renovation point of view, it’s very, very common to either under- or over-capitalize. I’d say 20% get it right, and you’re probably looking at maybe 40% to 50% over-capitalize, and probably about 20% or 30% under-capitalize. That’s simply because they’ve gone too cheap, they’ve not looked at the projects.

You can under-capitalize by doing a cheaper kitchen or cheap tile fittings or cheap tapware, and it looks cheap because they’re trying to renovate to a budget. You have to renovate to a standard, not a budget. Budgets are important to stick to, but set the budget in advance.

I find people who try to renovate to a budget because they pay too much for the property, they’re looking at their margin and it’s getting squeezed, so they start cutting costs on the items in the fitout, which ends up having a subpar job, and you won’t get the value out of it. The tiles, the equipment, or the fixtures that you’re putting in just won’t stand the test of time and just won’t look the part.

Then you have got the other side, which is what the majority of people do: they spend too much. They don’t shop around. You can sometimes spend half as much on very similar look and feel and quality if you know where to look.

That’s something that comes generally with experience, so it is a good idea sometimes for people to outsource a project, but if you’re going to make a bit of a hobby or a bit of a part time career from it, then you’re going to have to learn on the road, learn from your mistakes, and you’ll get better and better. But if it’s a one-off that you’re going to do here and there, then you’re probably better to get an outside advice.

Kevin:  Okay. The message or the bottom line here is after you’ve firmed up on the price with the tradie, the three questions to ask are “How long will you take?” “Which trades do you follow? and “Which trades follow you?” then spreadsheet the whole thing. Just one other quick question before you go, Patrick. Fixed-price quoting, is that what you do?

Patrick:  Yes, when it’s known. Like if you’re digging a hole in the back yard, you don’t know if you’re going to strike rock. You’re not going to get anyone to fixed-price quote that. However, I do get the fixed-price quotes from tradespeople, yes. I tell them “Look, I want to know, I want it to be fixed, I need to stick to it,” unless, of course, there’s complete unknown. But you shouldn’t have any trouble getting fixed-price quotes.

Kevin:  Okay. Patrick Bright, and Patrick is from EPS Property Search and also the author of The Insider’s Guide to Renovating for Profit. Thanks for your time, Patrick, great talking to you, mate.

Patrick:  My pleasure. Thanks, Kevin.

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Kevin Turner
kevin@realestatetalk.com.au
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