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Real Estate Rookie
5 Systems Every Rookie Investor Needs for Faster Rehabs and Bigger Profits
00:45:26
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- [00:00]
A
Ever thought about flipping houses or running a rehab project that felt maybe way more chaotic than you expected? This episode is for you. Today we're talking about how building real systems can completely change not just your rehab, but your life outside the business too.
- [00:15]
B
Yeah. Because success isn't just about finding good deals. It's about how you run the project once you're under contract. And today we're breaking down how Serena Norris built repeatable processes and how she creates scopes of work and estimates rehabs and the exact tools she uses to keep her flips organized and most importantly, keep them profitable.
- [00:42]
A
This is the Real Estate Rookie podcast. I'm Ashley Kerr.
- [00:45]
B
And I'm Tony J. Robinson. And for the third time we got a three peat happening for the real estate rookie podcast. Serena, welcome back. Appreciate you coming on.
- [00:54]
C
Thanks so much for having me guys. Good to see you again.
- [00:56]
A
Serena, for those listening that maybe didn't listen to the previous episodes, can you give us a little background on your real estate investing experience?
- [01:05]
C
Absolutely. So I got into real estate in 2015. I knew that I wanted to go the investment route. I didn't know where to start. So I was currently trying to get my license online, which I did and, and I, I ended up meeting my mentor like two days after I moved back to Washington state and he just mentioned he was flipping and I was like that's exactly what I want to do. Like where do I show up? So I started flipping with him in 2015, got thrown into high volume early. He was doing like 22 active flips at a time and we honestly didn't have really any systems. It was complete chaos. But over the last 10 years or make going into 11, we've done over 130 flips together. About $55 million worth of volume. We have a portfolio, mostly long term rentals, most mostly single family, some retail, commercial and also have short term rent, short term rentals. So my role and everything is, was the construction, management, the, the operating systems, all the finishes and the design for the flips. And I'm also a licensed broker so I sold a lot of the flips on the back end. And yeah, over my course, my time I just learned how to turn that chaos into repeatable systems. And today I focus on helping investors run flips like a business instead of that chaos and constant emergency.
- [02:37]
B
Yeah, so I think everyone, you know, flipping is probably the, the type of real estate investing that a lot of folks are familiar with because HGTV and all the TV shows and you know, people have come be become Celebrities flipping homes. Even our own James Dard is now a, A TV celebrity because he's flipping homes. But I, I think the people underestimate what really goes into or how chaotic flipping a home and running a renovation, even if we're not flipping just a renovation in general can be. So just maybe paint the picture for us. Serena, before you had the right systems in place, when we talk about flip number one or flip number two, what did your day to day life actually look like trying to manage all of these rehab projects?
- [03:18]
C
Yeah, absolutely. I mean, before we had the systems, it was total chaos. I mean, we were juggling so many projects at once. We didn't have any repeatable systems from project to project. So each project felt like it was starting over from scratch. When I was working with my mentor, I was just learning everything, but a lot of times, like he was also in pure chaos. So I was just trying to organize as much information as. And when I started seeing patterns, that's when I, that's when I was really starting to just organize everything, make and collect all that information. So I have like saved time where I can reference things. The other thing was that I just felt like we were making decisions all day long. I mean, it felt like constant texts and calls from contractors. We were absolutely needed to move the project forward. Like if we didn't respond, they then the project stalled and we, because we didn't have like templates to reference or we hadn't built that organization system a lot, we missed a lot of scope items. We had late budget surprises like change orders mid project or even after the project was done. Didn't fully understand the true costs until the very end. And of course that ate into all of our profit. Even though we were successful, we were making money on the projects. We definitely didn't. Yeah, we were losing out for sure. And mentally it was just exhausting. It always felt like we're behind. The biggest issue was that we were the system. And so if we forgot something, it just didn't exist. So a lot of times, like we would think like a contractor is being inefficient, but really it was us. We were the bottleneck, not the contractor.
- [05:10]
A
I can imagine this would lead to like a lot of miscommunication too, or especially having multiple people involved in relying on text and phone calls and things like that to communicate. Could be one person said one thing and the other person said or no proof that you even picked that tile instead of another tile. So how did your life change once you started to actually implement the Right. Systems. And not even on the business side. But I'm sure this impacted your personal life too.
- [05:39]
C
Yeah, absolutely. Yeah. I mean, going back to what you said, my. My biggest rule throughout all of this, especially when contractors are like, well, I knew that I'd be like, I don't assume anything because there can be so many miscommunications on job sites. And my goal is to eliminate all of. All of that and create as much clarity as possible for all parties involved. So, yeah, once I started building repeatable processes, one of the first noticeable change was, was mental clarity, confident confidence that we had on the execution. Also confidence we had in contractors, and contractors having confidence in us as well. And we. We started trying to answer as many decisions as possible in the planning phase, not in the execution phase. Like, there will always be problems arise that you didn't plan for, but if, if, if we can be more proactive instead of reactive, that saves so much time and headache, and it saves a lot of money. So it also built a lot of trust between us and the contractors. You know, a lot of flippers, especially in the beginning, they see contractors as an obstacle that they. That they need to overcome to get, you know, they're the house from A to arv. And what we learned is they are. They are part. They are an external team that, that we need to value so well. So trust between them is extremely important. So the more organized we are, the more organized and more trust that they can have with us. And then they want to work with us more and give us good pricing. And I was able to actually get some freedom. A lot of people get into flipping because they want financial freedom. The real freedom in flipping is having time control over your time and your energy. So flipping is 100% an active income source. And the goal is to systemize and streamline it as much as possible to have more control over your time and energy. So I got to a point where instead of working seven days a week, I'm traveling two or three times a month, sometimes spending months out of the country at a time because my systems are working for me. And, yeah, I stopped carrying everything in my head so that way people could execute without me.
- [08:14]
B
Yeah. And, Serena, we spent some time together walking some of your projects just a few years ago, and, like, just the way that you had everything so, like, it was like everything was at the tip of your tongue and, you know, knew where everything was. And. But that's something that. That happens with having the right systems and just being able to. To fall back on those so I've seen it in action and it's pretty impressive to see up close. But I guess let's zoom out maybe a little bit for, for our rookie listeners. Just walk us through the full lifecycle on one of your flips. If we go from acquisition to sale, what are some of those systems that show up at the various stages across, you know, the starting point to the, to the finish line?
- [08:55]
C
Yeah, absolutely. I always think about this in like there's five core systems that every flipping business needs. So you have your information systems which are really the foundation. So file storage where you organize the information and have that as standardized as possible. Right. Then you have your planning systems and then your execution systems, communication systems and quality control systems. So within the planning system that incorporates your acquisition and your post acquisition planning. So with acquisition systems specifically that's really like checklists for me that's going to be did I pull my comps? Have I reviewed my title? Have I gotten a sewer scope? We didn't get sewer scopes in the beginning for a long time and then we had a surprise 5k bill at the end. What is our strategy? And so acquisition system is a lot of gathering that information in a centralized place to be able to figure out our strategy as much as possible for to take that into our planning. Now once we know we're going to buy the property, the planning starts as soon as possible. And that is the most important part of, of your flipping process. If a lot of people, especially a lot of newer and people to flipping and beginners, they will oftentimes skip over that process because they don't feel comfortable or feel like they know enough to plan well and then, but with poor planning comes poor execution and, and a lot of times if you're already executing without the right plan, you're, you're already in a reactive mode. You're, you're already probably the chance of losing money ineffectively managing your time. So with the planning system within that I always have probably the most important piece for every flip is a very detailed scope of work and having that tied to your budget so you know what your projected numbers are going to be for that project. I also in the planning so I have my scope of work and I have my budget. I have my design and finish packet. So I have chosen all of the design materials for that job and put in all of the details of even how to install it, grout, color, everything right. And then my floor plans. I even on simple projects I loved having floor plans because they are an opportunity to have A centralized piece that everyone can reference and take you out of the equation. So little details like how high to hang chandeliers from the floor, how to put vanity lights. All of these questions that I've gotten over over the years from contractors, I don't want to answer again, right. That's the key is like it's not, it's not that you're never going to have problems, it's that I don't want any new problems. So having to be able to put all of those details into the floor plan in the scope of work, depending on where it should live, it's important. Execution system so absolute need like task management software to keep all of your internal tasks organized. And so that way you can track contractor scheduling milestones for different quality control checkpoints if you need a home inspection, like for permit inspections, how you keep all of that tasks. And then also when you're ready to hire an assistant or someone on your internal team, that's your place of communication and coordination. Communication systems. Figure out how the cadence between how you want to communicate with you and the contractor or you and your internal team. And then last but not least, which is the cherry on top is control is quality control. So again, like checkpoints at each milestone I have probably about, I think like five or six quality control checklists at any given point during, during the project. My goal is that the sooner I can, the sooner I can correct a quality control item, the least expensive it's going to be for me. So the result of that is like fewer surprises, faster decisions or taking me out of the equation to even make the decision flip, stop being as chaotic business becomes more scalable and the best thing is repeatable.
- [13:35]
B
I guess two follow up questions to that. First, I love the idea of having like the different like systems and what we need to plug into our business. But I also can imagine that there are maybe Ricky investors who are listening that might feel overwhelmed at the thought of putting all of these systems together. So two a two part question. The first part is which one would you focus on first and why? And then once you've decided on which one to focus on first, how do you know how far to take it before starting to focus on the other ones? Like do I need to get it 100%, everything's dialed in or can I take it a certain percentage? So where to focus first and how deep you go on that one once
- [14:16]
C
you've decided first, absolute system that everyone should apply right now and it's super easy is your filing system the information systems that you have are the foundation to all of this. Because if you have your information in a million different places, you have bids and emails, you have your, like, just all of your files not organized like per project or even not in certain files or folders within your project folder, right? It can, it creates chaos. I can't tell you how many times, how much time I wasted trying to find some piece of information or just a picture that a contractor needed. But because I wasn't organized, it took me forever. And so setting up a file system, like we would do folder for each project with, within that project, it standardized the same folders. We have our analysis, we have our purchase docs, we have our rehab, and we have our rehab pictures. And then we'll have like our listing folder as well. And that's the same folder system for every single project. And within that, it's just so standardized filing system to start buying that information. That's super simple, I'd say to answer your question, like, how, like how far to go? Okay, think of it like this. A lot of people will come to me and they're like, I have no systems. And I said, well, have you already done a few flips? And they say, yes. And I go, well, you already have systems. Every process that you are processing on each of your, on each of your houses makes up a system. Now is it an effective system? That's what you have to ask yourself and revise over time. So if you're going to even your first flip and think about how do I want to. How do I want to process this right now? And. Or you did one flip before and go, okay, this was my process. This is, this was, this is what I did. Here's where it didn't work. Here's where I think I should refine it and, and then try that on the next flip. And honestly, that's just, that's what I did. And I built it over time. Always coming back to the same mindset of like, how do I standardize this where I'm not. Where I'm not doing a different project. And starting from scratch from each project, how can I take from the last project, apply it to this project, and then make it unique to this, to that specific project? I hope that answers that question.
- [17:01]
A
We have to take a short break, but when we come back, we will get into creating your scope of work and running your rehab project in an efficient and repeatable process. We'll be right back.
- [17:11]
D
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- [18:07]
E
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- [19:24]
A
So we are here with Serena. So Serena, once the property is under contract, how do you organize the rehab before you've even closed on the property so nothing slips through the cracks over time.
- [19:36]
C
So over projects I've created like a super extensive scope of work and budget template So I essentially have been. Anything that we've ever done to a project will go into that scope of work template. It becomes organized. So that way I'm just working off of a scope of work template where I'm just deleting what I don't need instead of having to think to add what I do need.
- [20:00]
A
Serena, is this like in Google Sheets in a project management software? Where does this template live?
- [20:06]
C
Yeah, so I used to use smartsheets and now I've rebuilt everything into Google Sheets to be like an all in one. We were using Asana, Smartsheets and other platforms and I rebuilt it all in Google Sheets. You just need a sheets some sort of Excel platform to use this. And so the structure of that template is you'll have your item, your line item and then the most important part is like you'll have your description, line item description. And what that defines is what needs to happen with that line item. I also describe the outcome of that item. I specify what is included in that line item. So if it's materials and, or labor, both and, and then I'll put a quantity by it hopefully to give me out some numbers, some, some price, some, some costs associated with it. But most important part is the description column. And the reason why is, and before when we used to just do our scope of works on word documents, like literally bullet point, like this is. It would be like a one page bullet point walk with the contractor. So you get it. Cool. Like see what I see.
- [21:26]
A
Well Serena, I have a question on the line item. So in this template, how are you breaking it down? Are you going room by room? So it's like the kitchen, this is the cabinet. Or are you doing it by like the trade? So here's the plumbing section. Here's everything we're doing for the plumbing.
- [21:43]
C
I do it by trade 100%. I do not suggest doing room by room. The reason why is because I want to be able to put a quantity next to each one and have it one place. I also want to have it in the format of the way that contractors think. So I can. If you're comfortable going through room by room and that's comfortable when you are on the property to make notes. But when you go back, I really, I highly suggest putting it in a format where you're going trade by trade. And so I'll I have it in three main categories. You have like your initial services which are going to be getting the property clean to even start construction. We have like initial landscaping, we have rekey Trash out demo, making it like a clean slate so contractors can go in and work. Then I have my. All of my exterior, and then I have all of my interior. And then for all of the line items within there, each category, they are separated out by trade. So I have all my plumbing. I might separate out plumbing and then plumbing fixtures, but plumbing is all together. And then the line items within there are actually what's happening. So, like, plumbing install. And then my description is everything that comes with that. And the most. Like, back in the day, what we used to do, like, for example, with drywall, that one bullet point would just be repair drywall. That would be the only information we're giving to the contractor. And then he'd give us some number back based on filling in the gaps and assumption he had. And then he would execute, and then we would end up surprised why he didn't do it to the level that we were thinking of. Right. And so what we learned is that that extra description in there, instead of just saying repair drywall, we are describing the outcome we want, right? Repair drywall throughout the whole entire house to make the walls, like, smooth and blend in. We want them to match the texture with existing. Or if it's like, install a new drywall. We're detailing what level of finish that we want it. Right? Or if you don't know the level of finish for it, then describe extremely fine texture or smooth wall, no texture at all. And then include materials. I like to split that up into two different categories. Is it design material, like a finish material, or installation materials? And then labor? Who's responsible for that? So once. So once that line is complete, I always think about, like, that is your contractual language. If you took it in front of, like, say there was a dispute, and you took it in front of, like, Judge Judy, like, who would she side with? Right. I wanted to make it, like, where there's like, absolute, like, no. No question about what needed to be executed. And not only does that create, like, apples to apples, eliminates any sort of ambiguity or assumptions, but then it takes me out of the equation. They know exactly what to do. They don't have to ask me another question about it. And eliminates surprise change orders on the back end as well if it didn't meet my expectation. So going line by line, making sure that all of those details are covered. And luckily, I know beginners are asking, like, I don't even know, like, how to fill in that information. We live in probably the most easiest time we've ever lived in order to Learn and gain information. Like, use those tools. Use ChatGPT and AI to help you with this. Google and ChatGPT can even give you a framework, a checklist to go through. And when you're walking a property, you know it'll give you like, look at the fascia. Well, what's the fascia? Google what the fascia is like. These projects are your opportunity to learn. And I suggest creating like a scope of work to the best of your ability up to about 85%. And then start walking with contractors and just ask them to help you fill in the rest of the 15%. Get clarity on them. Ask them what they, what they suggest. Contractors love to talk about what they know. Right. So leverage that. Also you can hire a home inspector. They don't know everything about construction, but they'll at least tell you what to look for. Like what buyers are going to care about on the back end as well. We used to pay that like a few hundred bucks to walk the property with us and don't need a report or anything. Just, just, just point out what is going to be a defect or what I should look at and that helps you put all of the pieces together and then you can start getting pricing.
- [26:54]
B
Serena, when it comes to contractors and you know, you mentioned kind of relying on them a lot during this process. Should a rookie investor, you know, if they've never done a rehab before, should a rookie investor be working with a general contractor first? Or would it make more sense for them to go directly to the subcontractors like the actual tradespeople, the, the plumbers, electrician, the folks doing painting and drywall and the millwork. Or, or would it make more sense to work directly with the general contractor as a rookie?
- [27:25]
C
Yeah, I would say just to give some background on how where I ended up was I would pretty much only hire general contractor for about 30 to 40% of the scope of work and the rest that I would sub out. One of the reasons why we need to do that was our market just to keep costs lower. But there is some learning curve because you have to understand the coordination between all of the subs and the GCs who are hiring all of those subs. They fill in all of those gaps for the trades where the electrician stops and the plumber starts, for example, for certain things. So to answer your question, in the beginning, absolutely go the GC route. And when you are analyzing, you might need to add percent 10, 15% on top to, to when you're analyzing deals just because GCs are going to Be a bit more expensive, but they're going to help you do a lot of that coordination. And you can also learn how to manage a job site from them in the process. I would say though, vendors that you should always go directly to from day one, find a cabinet and countertop vendor and stay in control of that process the entire time.
- [28:48]
B
So that actually leads into my next question, Serena, is you said you'll use the GC today for like roughly 30% of your overall scope of work. How should a ricis, as they start to maybe mature, how should they make the determination of when to use the GC versus when to just sub it out? You mentioned cabinets as one example. But, but like just what, what is your decision making process to say keep this with the general contractor or sub this out to someone else?
- [29:15]
C
I would say if, okay, maybe it helps to explain what that 30% that I'll always use a GC for is. So that's typically more on the finish stage of the house where there's a lot of overlapping processes for when it comes to millwork and doors install and paint and flooring and, and where that would be really technical for me to figure out how to schedule all of those contractors. And again, I am not a contractor and I don't want to become a contractor because I'm a real estate investor. And so if it's too technical and overlapping and I don't understand the process to it, then I will rely on hiring out at GC to coordinate all of that. Now in the beginning of the project when I started getting more comfortable of hiring electricians directly and then just communicating with the general contractor if they're already on a job, hey, I'm going to be coordinating the electrician. Can you let me know when you are ready for electrical rough in? Can you let me know when you're ready for electrical trim out. And typically I only needed to schedule them twice. And so, and I felt confident enough in my dog's crying, confident enough in, in their scope and, and, and in coordinating them that I could take that away because GCS, they will add about, you know, a margin on top 10, 15, 30% of that subcontractor bid just to coordinate them. And so you'll want to eliminate certain things, but it still needed to work within my system. So if it was simple, the coordination was simple, it was easy and it didn't take up too much of my time and I understood their scope then that's when I would start taking it over.
- [31:17]
A
Now you said you might mark it up for a GC because you know they pay a percentage or cost a percentage of whatever the overall budget is usually. But what about, do you add any buffers or contingencies when you are estimating the cost of this rehab?
- [31:34]
C
Yeah, especially in today's market. Please add in a rehab contingency there. Right now labor pricing and material pricing are really variable. And what was nice from 2015, well 2017 to 2021 is in most markets they were really hot. So we're getting multiple offers, typically getting offers that are over list price. And so if we ended up going over budget and in part during the rehab, we'd be saved on that back end. But in most markets right now it's not as hot. You might get list price, you might get below list price and you might be offering buyers a seller concession as well. And so you need to have like your rehab budget as accurate as possible. And especially if you're newer, that's going to be hard for you to do. And so I would definitely add a contingency on top of that. And you know what, if the project doesn't pencil with those numbers, then it doesn't pencil and move on because you need to protect yourself with it.
- [32:50]
B
And yeah, and you, you mentioned like you know, margin and you know, your initial budget. But once the rehab starts, I think this is where a lot of rookies kind of get punched in the face where they're like I'm gonna budget, you know, $2,700 for this, this full gut rehab. And you know, it ends up costing 10x that amount or 5x that amount, whatever it is. But how do you make sure that once the rehab starts, assuming that you had a good budget to begin with, how do you track your actual cost against your budget to make sure you're not having any cost overruns?
- [33:25]
C
Yeah, so I have my scope of work organized in a way where when I get a bill like I can see what those costs and actually that excluding that scope of work and what that bill actually ties to. So I'm comparing apples to apples where okay, here's my scope for my. All of the electrical that I need to do, I need to do a full rewire or I just need to change out these outlets or just move a few lets. That's all in one place within my scope of work. So when I get the bill from the electrician like I can cross reference those are. And over time I developed like a cost tracking sheet that kind of like puts, puts the, puts the costs like where what I've projected what I have bid and what I've actually paid out and it all balances kind of like a checkbook and then lets me know at any given time during the project where I am projected to hit my budget. For a long time we didn't have that a long time. It was random bills coming in. They don't match the scope. We couldn't track anything until it was near like almost the end of the project or after the projects ended and were paid everything out. At that point we don't have any control to pivot or bring back any costs. So my goal is that at any given time during a project, I know what my projected numbers are going to be. So if I need to choose a tile that's a little bit less expensive on the back end or maybe choose a task that I know I can DIY like, like Nate once like had to do like a, like a short fence or something just to like save up some money, put on his work belt and build his events so he can stay within budget. You can actually make that decision at that time. So yeah, so it sounds like the
- [35:20]
B
biggest mistake is that a lot of times folks are a little too retroactive in comparing their actual expenses against their budget. But doing it in real time gives you the ability to kind of stop, pause, reassess and make changes as needed. Now I want to get into Serena, the actual tools, the software that you're using to operate all of these systems and keep your flips profitable. And we'll cover that right after a short break to your word from today's show sponsors.
- [35:47]
E
There are two kinds of real estate investors. Those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short term rentals or LLC held properties. These gaps surface only when filing claims. That's why investors work with nreg. They specialize exclusively in real estate investors understanding portfolios, risk at scale and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. Have NREG review your insurance with someone who gets investing@nreg.com bppod that's N-R-E-I g.com bppod There are two kinds of real estate investors. Those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short term rentals or LLCs held properties. These gaps surface only when filing claims. That's why investors work with nreg. They specialize exclusively in real estate investors understanding portfolios, risk at scale and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. Have NREG review your insurance with someone who gets investing@nreg.com bppod that's N-R-E-I g.com
- [36:56]
D
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- [37:37]
A
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- [38:44]
D
All right rental property investors, listen up. Our friends at Dominion Financial already have some of the best DSCR rates in the industry. Now they're the fastest too. They just launched 10 day DSCR closing. That's right, 10 days and they're still the only lender with a DSCR price beat guarantee. That means faster closing. The best terms. Zero guesswork. That's Dominion Financial. Check them out@biggerpockets.com Dominion Again, that's biggerpockets.com
- [39:13]
B
Dominion all right, welcome back. We were here with Serena and she just talked through the systems that every rehabber and flipper should have, how to stay on budget. But I want to talk a little bit more about some of the the tools and the software. So when you think about running your rehab projects, you're running your, your flips as a business, what specific software are you using? You already mentioned Google Sheets but what else are you using on a daily basis to stay organized?
- [39:42]
C
Yeah, so I used to use a bunch of different platforms and that worked for a while but my dream was to have it more in an all in one place. So I was. You are going to need a file storage. So whether Dropbox or Google Drive, we use Dropbox because Google Drive didn't even exist back in the day when we started. And so file system then you need a Excel based system. So smartsheets, Google Sheets or Excel. I don't suggest Excel because you really want it to be able to update in real time especially when you start adding different team members and then you have to your task management software. So we used Asana. I know Ashley used Monday.com that's going to be your task management use Podio for acquisitions. I know there's so many options out there now for that for acquisition pipeline and CRM. But honestly I rebuilt the like smart my smart sheets and my Asana to be like all in one into Google Sheets now. So that's what I operate within. So that way I just have one master Google Sheet for each project that has like 10 or 11 tabs. And that's my sense, that's my centralized information, my project hub that I use.
- [41:09]
A
So now that you have a place to organize documents like your scope of work, invoice permits, photos and contracts, that's all in Dropbox. How are you kind of now connecting these systems? So connecting your Google Sheets to your Google Drive, to your Dropbox to your task management software. Can you maybe give us an example of like one, maybe one little process and how it all implements and integrates together?
- [41:38]
C
Yeah, absolutely. So now actually instead of Dropbox I'm going to use Google Google Drive because now I have the Google Sheets so it's all within my Google but then I can easily link them to each other. And another system that I wanted to mention is that I use Chief Home Design Pro for floor plans. It's pretty easy to use and it's like super capable. You could build like a whole house with it. But I Use it for. Probably use like 2% of what it's capable of to do the floor plans and, and so yeah, to tie in them all together of course. And within, within your Google Drive, each folder you're gonna have like links to all of your, your Google sheets as well. But yeah, I keep all of my files, all of like the contractor estimates within the drive. All of my. Once I'm done with the floor plans, I'm exporting them into a PDF on the drive. I very clearly highlight which ones are finals, which ones might be old drafts. I like archive those. So that way your filing system is really organized. Imagine like if anyone went in and tried to find something that didn't fully know or wasn't onboarded, they'd be able to find it and building it all in one hub as well, like help just organize that information in one place. And so I don't even really need to link it anywhere it's all together.
- [43:16]
B
Serena, I think obviously we've covered a lot here on what Ricky should be focusing on. And like I mentioned at the top of the show, I've walked your project with you. I've seen how dialed in everything is and I appreciate you sharing early on how that was an iterative process for you. Didn't start off that way, but with each subsequent deal it got a little bit better. But what piece of advice do you have for the rookie listener who has no idea where to start when it comes to even potentially estimating the rehab and what that process looks like?
- [43:51]
C
Non negotiables. What you need in order to execute a project is a scope of work and you need your design and finish information. I like to keep them separate because again, I'm thinking about standardization. So my scope of work that I'm going to be you build from day one is your, is your launch pad for a scope of work template that you should be using for each project. And you just delete what you don't need, customize to that specific project or like add in and you keep adding. And so your scope of work, the design elements are typically going to be different per each project. That's why I like to keep them separate. And then your task management. So, and that's, that's really a progressive list of everything that you need to do and with like inputting dates next to it. So those are really like the, the three aim pillars that you need for each project. And so for the scope of work, if you don't know even where to start, what I suggest is hiring a home inspector to walk with you on the property and identify actual defects to the house. Stuff that would come up with a buyer's inspection after you're done and start and start making note of all of that. I'd look at the the comps and look at your subject house now and say what needs to change between my subject house to these comps that I'm trying to get the arv. What's the difference? I need to describe that. Then you're going to put it into by trade. And we like I said we live in like the best time to to have resources to for information. So I definitely highly suggest like utilizing AI to help you through through this, help you organize it and then put it into an Excel sheet and then even give it the questions like give it a prompt like for this line item, can you help me describe what the outcome should be, what the level of finish could be or what the and then decide should I have materials included or is this labor only? And then once that's billed for that one project, duplicate that for the next and then work off of that so you're not making everything from scratch. And same thing for the task management schedule. Use ChatGPT hey for fix and flip, can you give me a schedule outline of for everything with a flip Right. And that will give you a place to start, at least a reference and then you can customize like what works better best for your process.
- [46:39]
A
Well Serena, thank you so much. This is one of the biggest questions we get is how to run a rehab project, how to management, how to build out your scope of work. So thank you so much for giving us this little mini masterclass on getting organized and being able to be efficient and successful at running a rehab at your project, whether it's a brrr or you're doing a flip. So where can people reach out to you and find out more information?
- [47:07]
C
Yeah, absolutely. So I am going to be doing a lot of education over on Instagram. You can follow me systemstack IO if you want to learn about construction management, rehab, execution, how to systemize, working with contractors, that's going to be the place to go to find me. My personal is also Arina and also if this conversation really resonated with you and you want to go deeper into how to actually run flips like a business. I'm now sharing the exact system that I've built over the last 10 years. It's now available to the public. So go over to systemstack IO or systemstack IO.com and to learn more.
- [47:47]
A
Well thank you so much. We really appreciated you taking the time to share your experience with everyone. For everyone listening, make sure you subscribe to Real estate rookie on YouTube and that you're following us on Instagram at Bigger Pocket its Rookie. I'm Ashley, he's Tony and we'll see you guys on the next episode. At some point, your little real estate side hustle stops feeling little rent's coming in, maybe you've got a couple properties now and suddenly the money part gets real. Your tax bill's going up, you're Googling LLC versus S Corp at midnight and you're just hoping you didn't miss something that'll cost you later. That's where Collective comes in. Collective is the first all in one financial solution built exclusively for solopreneurs. Saving you time and money, they help you structure your business for success, whether that's forming a single member LLC or adding an S Corp election. Collective's AI engine, backed by expert oversight, automatically categorizes every expense so you never miss a deduction. Beyond bookkeeping, they handle quarterly tax estimates and prepare both your business and personal tax returns so you never miss a deadline. You'll also get integrated invoicing plus seamless payroll for S Corp owners, which can unlock thousands in self employment tax savings. And with Collective's community and support, you can finally take the solo out of Solopreneur. Right now, Collective is giving you 50% off your first two months when you go to collective.com rookie. That's 50% off your first two months at collective.com rookie.
- [49:08]
B
Hey rookies, if you're watching this, we want you to apply to be a guest on the Real Estate Rookie Podcast. That's right. Ashley and I are looking for amazing stories just like yours to be a part of our Real Estate Rookie Podcast. Now look, you don't need to be an expert. You don't need to have done thousands of deals. Even if you've done one deal, your story could help inspire the next listener
- [49:26]
A
as a rookie investor. Especially if you just got your first deal. It is all fresh in your minds and you are the best person to tell your story. Give your experience on how you got it done to help someone else get their first deal.
- [49:39]
B
So head over to biggerpockets.com guest if you want to be a part of our show. Again. That's biggerpockets.com guest and we'd love to have you on.