Stop Bleeding Money on Surprise Expenses

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A comprehensive scope of work is the essential blueprint that prevents budget overruns and project delays in house flipping, functioning as your insurance policy against chaos and surprise expenses.

• Scope of work lists every component you'll fix, upgrade or replace before work begins
• Your budget and scope of work are married - without detailed scope, your budget is just a guess
• Missing critical evaluations like electrical panels can cost thousands in unexpected expenses
• Walking properties systematically forces you to examine all 25 major components
• Vague contractor instructions ("update the kitchen") can lead to $10,000+ budget overruns
• Without a scope, six-week projects drag into months while holding costs eat profits
• Create your scope before closing by using a component-by-component, room-by-room checklist
• Beginners should start with light rehabs (paint, flooring, fixtures) for simpler scopes
• Detailed scopes allow for true apples-to-apples comparison between contractor bids
• A written scope eliminates arguments about what was supposed to be done

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Episode Transcript

Speaker 1 (00:00):
Without a scope, everything becomes a surprise.
That adds time and costSuddenly that six-week rehab
drags to three months andholding costs eat you alive.

Speaker 2 (00:09):
Ever had a contractor send you a bill that's double
what you expected and that'swhat happens when you skip the
scope of work.
No roadmap, no budget control.
That's just chaos.
Ever sat in your car scrollingthrough Zillow and thought man,
if I just knew where to start, Icould flip one of these.
Yeah, we've been there too.
Most people who want to fliphouses never even start, not

(00:31):
because they're lazy, butbecause they don't have the
blueprint.
Well, that changes today.
If you give us five minutes,we'll give you real-world
flipping strategies thatactually work.
No fluff, no theories, nogatekeeping, just real how-to
information for you to applytoday.

Speaker 1 (00:48):
And chaos is expensive.
I've seen people walk into aflip thinking I'll just fix what
looks bad.
Six weeks later they'rebleeding money and can't figure
out why.

Speaker 2 (00:57):
Today we're breaking down exactly why not starting
with a scope of work willabsolutely kill your profits,
your timelines and maybe yourwhole deal.

Speaker 1 (01:07):
And, more importantly , we'll show you how to avoid
that trap so your flips runsmooth and your budgets stay
locked in.
Let's start here.
A scope of work is yourblueprint for the entire project
.
It's the list of every singlething you're going to fix,
upgrade or replace before anyoneswings a hammer.

Speaker 2 (01:23):
Right on, jess.
And here's the kicker yourbudget and your scope of work
are married.
You can't have one without theother.
If you don't write out the workin detail, your budget, it's
just a guess, and guessingdoesn't make money.

Speaker 1 (01:39):
Exactly.
I'll give you an example.
A newbie I mentored bought acosmetic flip.
He walked the house and thoughtokay, paint flooring, new
appliances, simple enough.
But because he didn't scope itout, he missed the fact that the
electrical panel was outdated.
Boom, $4,000 gone.

Speaker 2 (01:56):
And here's the painful part.
If he just listed out the 25major components of a house roof
, siding, hvac, plumbing,foundation, all of it he would
have caught that.
The scope forces you to look ateverything systematically, not
just what your eye notices.
I learned that the hard way.
On my second flip, I told thecontractor update the kitchen.

(02:20):
No scope, just those words.
He installed custom cabinetsand quartz countertops.
It was beautiful, but it hosedmy budget by more than $10,000.
My buyers would have been justas happy with stock cabinets and
granite that was on me.

Speaker 1 (02:38):
And let's not forget change orders.
Without a scope, everythingbecomes a surprise.
That adds time and costSuddenly, that six-week rehab
drags to three months andholding costs eat you alive.

Speaker 2 (02:49):
Here's the shortcut Build your scope of work before
you close on the house.
I use what's basically achecklist Walk the property,
break it down component bycomponent, room by room, and
decide keep, repair or replace.
Write it all down and thenprice it out.

Speaker 1 (03:08):
And don't overcomplicate it.
Especially if you're new, startwith light rehabs, paint
flooring, fixtures your scopefor those might be one page.
As you build experience you'llget more detailed and start
tackling bigger projects.

Speaker 2 (03:25):
Let me add one thing Having a scope also makes
contractors compete on the sameplaying field.
If you hand three contractorsthe same detailed scope, you can
compare apples to apples.
If you don't, one bids high,one bids low and you're left
wondering who's ripping you off.

Speaker 1 (03:35):
That's huge, and it's not just about money.
A scope keeps everyoneaccountable.
When you walk the property atthe end you don't argue about
whether something was supposedto be done.
It's in writing.

Speaker 2 (03:46):
Think of it this way your scope of work is your
insurance policy against blownbudgets and endless delays.
Skip it and you're gamblingwith your deal.

Speaker 1 (03:55):
The takeaway no scope , no profit.
A detailed scope of work keepsyour budget real, your
contractors in line and yourprojects on track.
Okay, that's all for today'sepisode.

Speaker 2 (04:06):
This is Demo to Dollars.
Your no BS flipping playbook,one tip at a time.

Speaker 1 (04:11):
Catch us on YouTube for more breakdowns and tools we
use in our own flips.

Speaker 2 (04:15):
And remember chaos me a favor.
Follow us wherever you get yourpodcasts so you never miss a
show.
We're grateful to be part ofyour journey.
Now get out there and getcracking Bye for now.