Starting A Small Contracting Firm In NY

KD@Northeast

I am currently toying with the idea of starting a small contracting firm that will focus on home improvements funded under HUD in NY state. I was wondering if anyone has done any residential HUD projects and if so how I might get started and if there are any major issues working on HUD projects. For a little back ground I'm currently working as an estimator for mid-sized commercial company. I have also worked as an asstistant project manger for the same company. I have 3 years office experiance and 5 years field experiance. Any help would be great.

Sonny Lykos

I used to do a lot of HUD remodels in Michigan.

Get to know the building inspectors. Go to your local HUD office, or the building dept. that gives out HUD projects. If they're still as stupid as they were back then ('80's), expect them to spec 5/8" particle board for bathroom and kitchen sub floors, the cheapest vinyl siding, etc.

But they did pay within a couple of weeks.

Oh! And also expect to work for some really trashy people, sleazy areas, and RATS and ROACHES. I gave pellet guns to a couple of my guys to carry with them. If you have trailer trash in your area, don't be surprised if you get an offer to sleep with one of their daughters to do some unscheduled work for them. Keep you truck double - make it triple - locked - always, otherwise, half way of the hundred feet between your truck and the house, it will be emptied. Or........mount a gun turret on it's roof, and have it manned continuously.

After a few months, we just stopped doing HUD jobs.

I think you get my point.

Bob Kovacs

I'm gonna have to agree with Sonny on this one. HUD work is generally given out to the cheapest contractor, with no regard for quality- either in materials of workmanship. If that's your cup of tea, go for it, but I gotta tell ya- I've been in some HUD homes, and you want to just go home and take a 90-minute shower sometimes- it's like you can't get the "gross" off of ya.

Bob

Sonny Lykos

NOT FAIR!!

Someone is supposed to take the other side of this coin. Like:

1. Gee, thay can't help it if that's the "culture" in which they were raised.

2. So, HUD is just like everyone else - trying to save a few bucks.

3. Rats and roaches gotta eat too! They're just as valuable as people.

Tom R

I'll 'differ' just a little bit here, - - if you do 'township' HUD projects in a half-way decent town (like I used to), - - you tend to just have to deal with nice elderly folk who simply can't afford their necessary repairs on such a 'fixed' income.

Worked out fine for me as 'fill' work when I first started in business.

It was a good program too, - - the 'homeowner' would just have to agree that when they died, - - the house would get sold, - - and the township would get repaid first.

One thing I did learn fast, though, - - especially since I'm in Jersey, I guess, - - LOTS OF CORRUPTION!!

They give you a 3-day window to 'submit' your bid, - - funny thing, - - the only times I would ever get the job is if I would submit the bid just 5 MINUTES before that 3-day window was up.

At one point they even told me I was going to have to start getting the bids in earlier, - - NO BET, PAL, - - I'M WITHIN YOUR OWN WRITTEN RULES HERE!!

Anyway, - - try checking with your townships for a LOCAL HUD program, - - and you'll more likely stay in the better parts of town.

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KD@Northeast

I plan on setting up in Northern NY were there is more cows than people and the closest city is Syracuse and it's two hours north of that. So I won't be going into any getto homes. Want are the insurance requirements? Do they set a certain about of coverage that the contractor must have? Do they pre-screen contractors or is it just walk in say I'm a contractor put me on your bid list?

skylands

With all the work going on in up state NY, I just can't see wasting time on this work. You won't find the problem that Tom is talking about because you'll most likely be the only one bidding.

There's a reason why contractors only do 1 or 2 of these jobs and suddenly go away.

Consider this.
You'll spend 40 hours on an estimate with a list of 30 items. Then you'll find out that the HO can only qualify for 2 of the items.

You'll bid on 15 vinyl windows but they'll award you 2 and expect the same price per window.

You'll need WC whether you have employees or not.
You'll need a million dollars of liability.

I guess what I find ludacrist is that you'll bid on replacing a bath while you can smell spent fuel in the house from the malfuntioning 40 year old boiler in the dirt floor cellar.

But the best part is;
You'll be called back to replace the kitchen faucet that you broke even though you were never in the kitchen.

Other than that----It ain't bad work.

Sonny Lykos

Good post, Skylands, cause you're right on!

Sider' Brian

KD@Northeast:
I agree with Sky however if you choose to do these jobs get general liability at the least and look into getting bonded if at all possible.

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KD@Northeast

Wow, thank you all for the great advise. I'm really glad I started this post; it's been a real eye opener.

i_plant_art

we used to mow for HUD ...... that lasted one year..... all i have to say about HUD is


RUN
RUN
RUN

they will tell you "oh we have lots of work available...." and they do .. and there is a goos reason....... they want to pay cheap, they want it done yesterday reguardless of your schedule if you cant DROP what your doing to go and board a window 40 miles from where you are for only $20 they bitch to high heaven they dont care about you the contractor, all they want is to look good for their boss. the will tell you one thing on the phone then when u complain to managment b/c it hasnt happened you get on a confrence call and they deny everything, ie backstabbing....

they pay 30 days ......... from the time they GET your invoice.... so as far as they are concerned "it took the post office a while to get it here" " it took 5 days to get here, sat in the box over the weekend for 3 days since we leave early on friday, took 4 days to get processed before it went to accounting, it took another 4 days in accounting to cut your check, then it took 3 days in the box again since we leave on fridays early..again, then it took another 5 days to get back to you........ thats why it took us 63 days to pay you".....

these are the types of excuses you will get. also the personell in the office gets "flipped" like 3 times a year, the level person i was supposed to deal with got replaced 3 times, and their boss teice and their boss 3 times, as well as all of their assistants, all within a one year time period, no lie..... this makes it VERY VERY difficult to work with these people. someone will come in the middle of something and think they are now gonna "change the process" it gets worse......

as mentioned before i cant tell you how many times i have been "solicited" while on jobs people will try and sell you thier kids, themselves. they will do anything under the sun for a pack of cigarettes.... they will follow you around, there will be nobody on the street when u pull up, within 7 minutes of you being there i promise you there will be 9-15 people in the yard across the street sittingthere watching your truck, and you, just waiting to turn your head. they will follow you around the neighborhood, and houses.

i gave my foremen and my guys all 900,000 volt stun guns to carry when they worked in these areas, i myself carried one in my tool belt when doing small repairs as well as carried a hand gun, and made it visible on my waist at all times, so to let all that were watching know i wasnt gonna take any crap......

how many times have i had my life threatened... shoot i lost count.... been chased with a bat, pipe, knife, to this day i think ive even been shot at while working on a home but wasnt for sure then, and still cant prove it.

overall like i said before RUN RUN RUN its not worth it... it seems good from the outside, i know it really does. your being promised and told all these great things, buts thats it .. it only sounds good....... take the advice of myself and others before me ... it aint worth it... its not worth doing 25 HUD jobs to profit 50 when you can do one suburb job and profit 50...........its not worth having to carry a gun, every single day and always look over your shoulder, as well as keep one eye on your truck.

i promise you its not as good on the inside as it appears to be on the outside......


RUN RUN RUN

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"Anyone doing it cheaper AND being insured is running a CHARITY"

sawdusted

KD ,
where abouts in upstate ? some areas there are more carpenters than cows

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