Hey guys! Welcome back to another episode of “Propelio TV” with Darryl Dyke and Steve Rosenberg. Today, we’re diving deep into the nitty-gritty of real estate with our special guest, Ron Carlson. With years of experience under his belt, Ron offers invaluable lessons for those looking to navigate the dynamic and often chaotic world of real estate.
A Rocky Start: When It All Began
Ron Carlson’s journey into real estate wasn’t a smooth ride. Starting off with a heavy-duty summer job at his dad’s construction company, Ron learned the ropes from the ground up—literally. Digging trenches and operating machinery became his entry point into the field. A pivotal moment occurred when he questioned the company’s owner about his wealth and discovered the true power of real estate.
Entering the Market: From Wholesaling to Holding
By 2009, Ron fully plunged into the real estate market. Starting out with wholesaling, he learned the hard way about the ups and downs of the industry. Despite the market crash, Ron found opportunities by buying properties at discounted rates and flipping them for a profit. But as he gained experience, Ron realized the potential in buying and holding properties, leading him to scale back on accepting new clients.
The Birth of Renovation Gurus
Ron faced many challenges with unreliable contractors. Constant issues, from work delays to outright theft, forced him to think differently. That’s when he decided to start his own contracting company, Renovation Gurus. By hiring skilled workers and gradually building a reliable team, Ron was able to control the quality and timelines of his projects. Renovation Gurus soon grew into a business that handled multiple rehabs every month.
Lessons Learned: The Importance of Details
One of Ron’s key takeaways is the importance of detailed contracts and clear expectations. When hiring contractors, he emphasizes the need for itemized bids to avoid any room for errors or miscommunication. This strategy not only keeps contractors accountable but also ensures that investors understand exactly what they’re paying for.
Surviving the Sucker Deals
Every seasoned investor has their horror stories, and Ron is no exception. He recounted a particularly disastrous project where lousy contractors and poor planning led to over $200,000 in losses. The experience taught him to be more cautious and diligent, especially when it comes to pulling permits and choosing the right crew.
Managing Contractors: Trust but Verify
When it comes to paying contractors, Ron advises a cautious approach. Always start with a down payment and only release funds as work progresses. This minimizes the risk of contractors abandoning the job midway. Regular site inspections and clear communication are crucial to ensuring that projects stay on track.
Prioritizing Repairs: Where to Spend Money
Ron emphasizes the importance of focusing on high-impact areas like kitchens and bathrooms. These are the rooms that potential buyers scrutinize the most, and a well-done kitchen or bathroom can significantly boost a property’s value. On the flip side, don’t waste money on unnecessary updates like new roofs if they aren’t leaking or fully replacing windows unless absolutely necessary.
Summary
Ron Carlson’s journey in the real estate industry is a testament to perseverance, learning from mistakes, and adapting to challenges. From his humble beginnings in construction to founding Renovation Gurus, Ron’s story is filled with valuable lessons for aspiring real estate investors. His emphasis on detailed contracts, cautious contractor management, and strategic renovations highlights the critical aspects of successful real estate ventures.
By focusing on high-impact areas and maintaining strict oversight on projects, Ron has navigated the often tumultuous real estate market, turning obstacles into opportunities. His insights serve as a guiding light for anyone looking to thrive in the dynamic world of real estate.
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