For someone working a day job, is the rehab phase of BRRRR something that can be delegated

Question

Buying can happen on weekends and refinancing is mostly paperwork, but the renovation phase is the one that tends to demand real-time attention for a few months, which is a problem for anyone holding a job they intend to keep. The choice usually comes down to three paths. Hand the rehab to a general contractor on a fixed scope, hire a project manager to run contractors for a fee that comes out of the same margin the refinance depends on, or run it personally and accept that evenings get consumed and every decision made without the operator present costs a day of waiting. In practice the delegation cost is rarely a rounding error. A capable project manager who is paid to be responsive can be the difference between a deal that leaves 9k on the table and one that leaves 25k, because unmanaged delay compounds through holding costs and missed windows on materials and labor. The GC route works best when the scope is tightly defined up front and change orders are pre-negotiated, since that is where an absent owner gets exposed. Anyone weighing this should price the PM fee against a realistic estimate of their own delay cost before assuming self-management is cheaper.

samantha_ruiz · Accepted Answer

I ran the first two myself and hired a project manager from the third on. The fee was 10% of the rehab budget, so about 5,200 on a 52k scope.

What I got back for that wasn't quality, the finish was about the same. It was calendar. My self-managed second one ran 19 weeks against a 12 week plan because I couldn't be on site to make small decisions, and the delay cost me interest on hard money plus two months of rent I never collected. That was bigger than 5,200.

Where it bit me is that I stopped learning. Deal five, a subcontractor walked and I didn't have the relationships to replace him myself. @priya_n21, if you delegate from day one, be honest that you're buying time and not building the skill.

chriswalton8 · Answer

The difference between the GC and the project manager is worth spelling out for anyone who assumed the GC was the one managing. If both are being paid, what does the second one do that the first one doesn't?

aaron_fitz10 · Answer

@chriswalton8, a general contractor prices and delivers a defined scope with his own crew and subs. A project manager sits above that and represents the owner, checking work against the contract, approving draws, chasing the permit office. On a small single family rehab with one competent GC, the second layer is often redundant. On a scope split across four separate trades because no single GC would take the whole thing, it isn't. The delegation question is downstream of what was bought. A gut rehab needs management. A paint, floors and one bathroom job mostly needs someone to show up and check.

devon_pierce · Answer

A hard filter worth applying when screening: no roof, no foundation note in the inspection, no permits beyond electrical. It rules out a lot of the deeper discounts, and plenty of properties passed over on that filter go to buyers who probably make more money on them than a first-timer would have. That's a reasonable trade for a first deal. The lighter scope also gets to the tenant and the refinance faster, and months tend to be the expensive part, not materials.

jordan_ellis2 · Answer

Six months in and no deals yet, and this thread is the clearest argument I've seen that the rehab you choose decides the workload before you hire anyone.

For someone working a day job, is the rehab phase of BRRRR something that can be delegated

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