How to Prepare
Entering into a home renovation means for the next several weeks or months you’re about to be locked into a relationship with relative strangers for the stress-filled task of performing a lengthy surgery on your most important possession, your largest financial investment, and —perhaps most seriously—an object that is connected to all manner of psychological and emotional triggers in you. So … no problem.
Many of us are used to thinking negatively about construction.
The home-improvement industry typically receives some of the highest levels of consumer complaints of any industry.
- Bad experiences are shared more often than good ones.
- There are more than a few inept contractors out there.
- There are also scam artist contractors preying on unsuspecting homeowners.
- There are also homeowners not handling their projects correctly.
But usually—just like in a relationship that’s hit a rough spot—there’s no “villain” per se.
There is a lot of fear, ignorance, often a stunning lack of self-knowledge, and poor communication which leads to misaligned expectations and goals.
The Four Greatest Threats to a successful contracting relationship
1. Fear -Fear costs $$$ more than any other factor on a project
- Specificity drives out fear - don’t trust allowances
- Transparency drives out fear and builds trust
- The homeowner should know their home.
- The homeowner is ALWAYS the GENERAL CONTRACTOR. Learn. Don’t abdicate.
- Good contractors want you to understand how things work.
- Dishonest contractors take advantage of the “ignorance gap.”
- Ask questions about every step.
- Is that the best way to do it?
- Is that the only way to do it?
- Get outside advice and keep getting advice along the way.
- Use your Designer as your advocate
3. Poor Communication
- Stay on top of things
- Short lists
- Daily conversations
- Set a daily debrief appointment and avoid calls outside of business hours.
- Keep a project journal - Take lots of pictures/video
- Ask your builder if they use Management Software
- Ask to see the Gantt Chart - Critical Path
- Underscore and verify conversations with summary emails- “So as I understand it this is what we decided today … Is that correct?”
- Walk the job alone as often as possible
- Be present for inspections
4. Misaligned Expectations and Goals
- Hire a builder who clearly loves building
- Reconfirm schedules weekly
- Hold up your end of the schedule
- Only pay for work completed correctly, but then pay promptly
- (California max deposit of 10% or $1,000 — whichever is SMALLER.
- Understand these things about your builder:
- They’ll hire out at least some of the work - know which parts and to whom
- May mark up materials and labor - pay a fair fee and buy materials direct
- Builders aren’t designers. I repeat … Builders aren’t designers.
- You’re not the only thing going on.
- They won’t be on site every day
- Sometimes delays are out of their control - domino from other jobs/subs
- Builders are small businesses - good contractors can hit difficult times
Early Warning Signs of a Contractor in Trouble
- Sudden decrease in their workforce for a project
- Change in demeanor
- Missing appointments
- Delayed materials deliveries
- Failing to pay their subcontractors or suppliers on time
Phase 1 - Design
The time of the biggest remodeling mistakes, but also the biggest breakthroughs. Don’t rush! Design matters most!
Your designer should …
… be a “deep” listener (searching for the deeper needs beneath the expressed needs).
… help you discover your “why.”
… be passionate and opinionated
… offer ideas you never would’ve considered
… ride the line between giving pushback to certain requests and yielding to your lead
… not have vested interests (materials mark-ups, etc.)
Phase 2 - Planning
- Scope of Work
- Only after we’ve completed the creative process can we determine the scope of work.
- From an initial scope of work we can obtain rough estimates of costs.
- If costs need to be adjusted then we either return to design or revise the scope of work.
- Rinse and repeat until design, scope of work, and budget begin to align.
- Once the rough budget is acceptable we then produce whatever plan documents are necessary to obtain accurate bids and/or satisfy governing agencies.
- The goal of plans is to adequately inform and dispel fear. Unknowns create fear in bidding and fear always results in more expensive bids.
- “Plans” can be anything from a detailed list, sketches, photorealistic renderings, basic building plans or permit-ready plans.
Phase 3 - Bidding
- Unless we have implicit trust in a particular contractor, obtain a minimum of 3 bids for every category.
- Enlist your design team to reconcile estimates into comparable bids (apples & apples).
- Take note of and investigate “outliers.”
- They may simply have different pricing
- Or they missed something
- Or they caught something everyone else missed.
- References, references, references!
- Home Advisor
- Contractor State License Board
- Proof of Liability Insurance
- Questions for Contractors:
- Are you a paper contractor or hands-on?
- Who is supervising your project?
- How big is your crew?
- How often will you be on site?
- How often will you be communicating with us?
- Will you be itemizing your estimate?
- What is your fee or percentage?
- In addition to your stated fee do your subcontractors give you kickbacks?
- Do you mark up materials?
- Can we use your discount to purchase materials directly from suppliers?
- How will the job site be left at the end of every day?
- Will you have issues taking direction from our designer?
- What level of residential craftsmanship are you most accustomed too?
- How do you handle change orders?
- Don’t ignore your subjective impressions - it’s a relationship!
Phase 4 - Contracts & Schedules
- Deposits - California: 10% or $1000, whichever is less.
- Preliminary Notices, Mechanics Liens, and Lien releases.
- Change orders
- Contractors should provide schedule estimates. Every bid should include a time estimate.
- Phrases like “with all diligence” and “without interruption” should appear in every contract.
- Turn-key vs. Time and Material contracts.
- Avoiding “Allowances” - another word for “over budget.”
- Daily clean-up and debris disposal.
- Contractors should never be ahead of the completed work in invoicing
- Scheduling should address your ability to living accommodations and your ability to eat, escape, rest, and decompress.
- Scheduling should accommodate wait times for ordered items and the necessary lead times for decision making deadlines and purchases.
Phase 5 - Building
- Review site considerations
- dig alert
- Review the daily schedule
- Inspections - City, Designer, YOU
- Who’s handling Final Clean Up?
- Final payments come only after Punch List completion.
Phase 6 - User’s Manuals, Warranties and the Shakedown Cruise
PHOTO CREDIT: Getty Images