Undergoing Home Construction or Remodel

In the wake of hurricanes Harvey, Irma and Maria, undergoing major construction in your living environment is said to be nearly as stressful as divorce or a death in the family. The information below is offered as a strong dose of preventive medicine to make the remodeling process as positive as it can be.

Important questions to ask contractors when you are getting bids.

  1. Have you done other projects like ours before?
  2. May we see a portfolio, or some photos of your previous jobs?
  3. How long has your company been in business? Do you have a website?
  4. May we have a few references from your previous customers?
  5. Do you personally think your company is a good fit for the project we have in mind?
  6. Are you fully bonded and insured (workman’s comp and liability)? What are your limits of liability?
  7. What type of warranty do you offer on your workmanship and materials?
  8. Do you have your own crew, or do you use day laborers, or a combination?
  9. For this project, would you be using subcontractors? Do you require them to be licensed and show proof of workman’s comp and liability? If their contribution to the job is significant, would you mind providing some references for them as well?

Information that should be in the contract.

  1. Your name, address, and the location of the job site (if different from your primary address).
  2. The contractor’s name, address and license number.
  3. A short description of the project, along with blueprints or drawings.
  4. Start and completion dates for the various aspects of the job. How you will be informed of project time table, on a weekly or monthly basis and whom will be your point of contact, including email and cell number. Will this point of contact be a project manager?
  5. The payment schedule, including late-completion penalties if any.
  6. Clarification about who will be responsible for obtaining the permits and staying on schedule of permit dates.
  7. A written promise from the contractor to comply with zoning and building regulations, as well as to arrange for and be present during government inspections, including timely updates to you. If living in a gated community, complying with community deed restrictions.
  8. Hours and days that work will be done, including an agreement about noise.
  9. Cleanup procedures, both during the job and upon completion.
  10. The contractor’s insurance information with policy number, including a copy of certificate of liability.

Drafting a memo of understanding.

Once you have selected a contractor, or if you are trying to decide between two or three quotes, it can be helpful to draft a “memo of understanding,” clarifying specifics about what is included in the base price and what isn’t. Any reliable contractor will be happy to talk this through. If they are reluctant to discuss a lot of detail with you, that isn’t a good sign, as construction is fundamentally a detail business.

  1. Is the contractor assuming a particular price range for certain materials that have not yet been selected? For example, let’s say you have specified tile in the guest bath, but you aren’t sure what style yet. The contractor’s cost of goods will obviously be very different if you choose a basic ceramic tile vs. an imported Italian marble. If your contractor is responsible for providing the tile, it’s important to have a shared understanding between the contractor and you of the price range assumed in the base price. That way, if you end up selecting the most expensive product on the market, you will already have a shared understanding that a change order will be required to cover the additional cost.
  1. Is the contractor planning to provide a basic version of certain items, assuming you will upgrade later in keeping with your taste? (light switch covers, vent covers, doorknobs, drawer pulls, etc.?) It might make more sense to have them install the exact style and finish you prefer in the first place. Be sure to get a deadline for when the materials will be needed in order to keep the project on schedule.
  1. Are there some pending design decisions that could impact the original estimate? For example, let’s say you are still deciding about whether or not to add an additional window in the master bedroom. Clarify in your “memo of understanding” whether the window is included in the base price; and if not, what the cost range will be if you decide to proceed.
  1. Are you expected to provide certain finish materials? (Faucets, light fixtures, appliances, etc.?) If so, make sure you have a complete list in writing of what you are expected to purchase, including a deadline for when the materials will be needed to keep the project on schedule.
  1. In almost every remodel, there are unfortunate surprises. Let’s say the crew pulls out your old cabinets and finds a mess of dry rot. You’ve most likely seen HGTV series when they typically find an issue that adds to the cost of the job, yes it happens. If the work clearly needs to be done in order to complete the job, which could be required by zoning and building regulations, should they go ahead and take care of it; and if so, are they pre-authorized to bill you for any extra labor costs? Is there a cap on the additional that can be billed without your written permission? How about a situation where you have a choice. Maybe they open up the plumbing and realize it is calcified. Not an emergency situation, but less expensive to replace it now than later. Should they contact you? What if you cannot be reached? Is your spouse or significant other able to make a decision? Are they on the original contract stating that they may be contacted as a point of contact as a decision maker backup? Not every scenario can be predicted in advance, but an experienced contractor will be able to alert you to some of the more likely possibilities so you can discuss an action plan before the project is in full swing.

Creating a thorough memo of understanding in advance can save you a lot of money and headache later. It is also the foundation for creating accurate change orders.

Information to Include in Change Orders.

  1. A reference to the original contract (your name, the contractor’s name, the project description) and the date of the change order.
  2. A description of what is being added and/or deleted, and the materials involved.
  3. Summary of additional charges, along with an adjusted payment schedule.
  4. Adjustment to the work schedule, if needed.
  5. Signatures of all parties.

Communication for the contractor, also important for you to know.

For the success of the project, clear and detailed communication will be required for all parties involved. It’s very important for a contractor to have a project manager on the construction team with whom the customer feels comfortable and relaxed.

Some contractors have a wealth of experience and technical skill, but are weak in the area of interpersonal relations and business negotiations. If that is the case, it’s vital that they put someone else in charge of their estimating and project management, in the same way they might sub out the electrical, or any other portion of the job that lies outside their expertise. If a situation arises that the customer is not satisfied with the project manager, how will this be handled? Will contractor provide an alternate project manager and will this add to the timeline of the project? Fumbling through this step or omitting it altogether is simply not a viable option, especially on a large project. The budget, timeline, and basic feelings of goodwill for all parties will invariably suffer.

Although this sounds like many steps in the beginning, even before a contract is signed, these are all very important steps and will make the project move along much more smoothly for all parties. When selecting a contractor for a major, or even minor, home or office project, it’s important to understand all aspects of what all parties expect, much like creating a business plan so to speak. You would not want to start building a home or starting a business without a plan of action, including the costs associated with such plan of action. Florida Disaster Contact List  may also be helpful.

Warmly, 
Kandi Phillips
www.LavishNaplesFloridaHomes.com
http://www.KandiPhillips.com

www.AwakenYourSpace.com
www.LiveYourIntention.com

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