A few months ago, I was asked to provide my advice and opinion to Chicago Realtor Magazine for an article they were developing about working with residential contractors. Below are my “long form” answers to their questions. Here is a link to the article as well.
What are some smart home renovation practices that can provide additional security when working with contractors?
Assuming you are looking for smart practices for a Homeowner to use that will provide financial or physical safety for them and their family during a renovation.
From a financial perspective start with an Insurance Certificate naming you as “Additional Insured” from the Primary or General Contractor and from the Sub-Contractor(s). This will provide the Homeowner with valuable coverage in the event of an accident or theft. Most importantly it provides the insurance information they may need in the event of a dispute. Additionally, it confirms the Contractor(s) is and will be insured during the project. The Homeowner should make it clear that no work will begin without the certificates being in their hands.
Pull permits. Yes, it will cost more and probably raise your taxes. Why? Because the inspection process will ensure that the work is performed to at least the minimum level allowed by law. Having permits on file may also prevent costly delays and re-work when the time comes to sell. If there is a Condominium Board or HOA get them involved in the beginning. Find out their requirements and expectations. Make sure they are understood by all parties concerned. If you don’t it could prove costly.
If your worry is security for your valuables or personal safety, it’s all about prevention. Starting with the previously mentioned Insurance Certificate. Even though only a portion of the home will be under renovation the entire home will be affected.
Here is how a Homeowner can mitigate some risks:
1) Remove any art, valuables or collectables from the rooms adjacent to the room(s) being renovated.
2) Discuss with the contractor in advance what room(s) they will need for storage, staging, or additional workspace. That will create the basic work zone.
3) The construction people will need a bathroom. If you cannot provide one within the work zone discuss a Port-A-John with the contractor.
4) Remove excess cash, jewelry and other valuables from the house for the duration of the project.
5) Discuss supervision, ingress and egress with the contractor. You have a right to know what personnel or sub-contractors will be in your home on any given day.
6) If you can, give the contractor key(s) to one door. If that means you must temporarily change or re-key a lock you should do it.
How can homeowners pick the right contractor for their project?
Start with a plan not a price. Homeowners should look for someone who understands the entire process and can assess your needs. It may be wiser to bring in an Architect or Designer to develop a plan first. Understandably, they usually charge something to start their process. It is usually money well spent. Most will offer an initial consultation to discuss your project for little or no money.
An Architect, Kitchen Design or Interior Design firm can generate plans and specifications suitable for soliciting bids from contractors. I can’t say this enough.
“Knowing how much you want to spend is not a budget it is a spending wish. Knowing how you are going to spend that amount on a per item basis is a budget!”
Size matters. Get the size and fit right. Contractors come in varied sizes and structures and areas of expertise. Not all contractors are going to be a good fit for your project. The best fit for you may be a General Contractor, a Design Build firm, a Specialty Contractor, a Kitchen & Bath Design firm, an Architect, or an Interior Designer. Each can bring a unique set of skills and capabilities.
Community roots. This lesson I have learned from my Realtor friends. It’s important to be active in the community you serve. For me that’s the Hinsdale Rotary. Look for a company that invests time and energy (not just money and advertising) in the community. In my book that says a lot about their character.
The same can be said about their professional community. Is the person or firm you’re hiring active in a trade association? A great place to find a Remodeling Professional is the National Association of the Remodeling Industry (NARI). The Chicagoland Chapter of NARI is one of the oldest and most robust. I have been a member for years and maintain a Certified Remodeler certification. NARI members agree to a code of ethics as a condition to becoming a member. NARI also provides education, business development, and best business practices education for its members.
An inquiry into the NARI Chicago office (WWW.NARICHICAGO.ORG) can get them started. If the Homeowner can’t find the information they are looking for send a quick note to the NARI Chicago office and someone will get back to you and give them some advice on the type of Remodeling Professional that would be best to start with.
Additionally, you can ask for referrals from friends and neighbors nearby who had a similar renovation done recently. Just don’t ask them for a name, ask some questions about the process they went through. Likes and dislikes.
What are ways to identify a potential scam?
1) Turn off the TV and stop being so optimistic. In my opinion, most television renovation shows are more fiction than fact. There are exceptions like This Old House the Mike Holmes programs.
2) If the Professional gives you a quote on the spot without a Design and Specification being developed, run.
3) If the Professional isn’t willing to give you references you can call – run.
4) It’s not unusual for materials such as cabinets to have a long lead time. Typically, cabinets and other finished materials need to be paid for in advance at the time of order. However, if you are asked for a large down payment to just to get on the “schedule” run fast.
5) If they encourage you not to pull a permit – run.
6) When you explain your requirements for insurance certificate(s) and they balk or worse yet pull out a copy from their brief case and say there you go.
7) Make sure the contract has a payment schedule with measurables for work being done.
8) If you hear a phrase like “my guys do it all” it sounds nice and cost effective. But what they’re really telling you is they won’t be using licensed electricians or plumbers. That should keep you up at night.
Can you share any tips for homeowners working with a trusted contractor?
Communication is the key. When people stop talking things go bad. Have a project review at the beginning and the end of the day with the Contractor or his/her designated lead person. Make sure at least one of those meetings is in person.
“Change Orders” can be expensive. The best way to avoid them is to have a detailed plan and budget. If changes are needed both parties should agree that if it’s not in writing and signed by the Homeowner, there will not be any additional costs to the Homeowner.
Have a contingency fund. Even the most experienced Remodeling Professionals don’t have X-Ray vision. If unexpected conditions are discovered it’s usually during the demolition phase. It is not unreasonable to expect to be charged to remedy the problem. A thorough inspection by the Lead Carpenter, Electrician and Plumber prior to starting the project with the plans in hand can help avoid some of these issues.
Some problems hide in plain sight. For instance, a water or sewer or electrical upgrade required by your municipality. Ask for an on-site meeting with the Inspector early in the process to determine if any of these issues exist.
A preconstruction meeting with the Contractor and Inspectors once the plans are approved is a good idea. This helps to set everyone’s expectations properly.
Realize that nothing will keep you safe from dust. Having said that, discuss and set expectations for keeping the job site clean and safe. Be assertive if you don’t feel concerns are being addressed. You have a right to set expectations for cleanliness, conduct and behavior, language, tobacco use and anything else that is important to you for your property.
On the Radio!!
I was honored to be interviewed by Roger Piper on Home Answers Radio last month. It was the fastest 12 minutes of my life.
