6 Tips On Dealing With Renovation Contractors | Propertylogy

6 Tips On Dealing With Renovation Contractors

By on September 6, 2013

If you think that you will have the upper hand over a contractor because you are the client, you are in for a big surprise when you find out that you are wrong. Renovation or remodeling contractors are one of the toughest people to manage in the whole property transaction. While property agents will smile at you even if you sneeze in their face, contractors can “punish” you subtly if you step on their toes. It does not matter whether you paid a low price or a high end premium price, behaving like a dictator with contractors will not do you any good.

“Punishments” can vary from delaying the completion, to shoddy workmanship, to materials of lesser quality, etc. Even the most reputable company with the best public relations will snarl at you when there is friction. New home owners are the most vulnerable to problems with contractors. This is because they are more likely than others to treat a contractor like a waiter who is suppose to take orders from you. By the time they realize first hand that a change of tact is required, it is already too late as the relationship has soured.

The worst case scenarios are that contractors run away from the project due to cash flow problems and become uncontactable. This is a business that require high working capital. So when contractors take up too many projects by stretching their working capital, just one non-payment from one client can potentially send their business packing. Another nightmare scenario is that your contractor refuse to complete the work unless you lower your expectations and the quality agreed is compromised. In this case, you might insist that you get what you signed up for as it was agreed in black and white. But trust me, when problems arise, that piece of black and white will not help you.

So here are some tips to deal with contractors

Avoid one from someone you know. Contracting is such a popular business for the self-employed You will find that all your friends will definitely have someone they know in their social or family circle who is doing it. Hiring one based on friendly recommendations is a sure way to hell. I’m not talking about those who did a god job for your friend and hence the referral. I’m talking about those who you hire solely because he is a cousin of your friend. On one hand, you will feel embarrassed to raise your voice at your contractor because of the social aspect. On the other hand, the contractor may take your business for granted as the relationship is seen more of a friendly relationship rather than a business relationship. You can deny this all you want. But the fact is that the social dynamics are very different when you hire from a friendly referral because both parties approach the relationship in a different way.

Hire an interior designer. The best tip on managing contractors is actually hiring someone to do it for you. Interior designers with glamorous portfolios that we see in magazines have a lot of experience managing contractors. They will have a huge network of credible contractors to work with as well. The good thing about hiring a designer to manage all these stuff for you is that you can demand the sky from them and it is their job to meet your demands. Whether they will be able to do it is another matter. But they will go all out to make you satisfied. And because contractors want a long term repeating business with interior design firms, they are more receptive to them than to you. They drawback is that hiring these firms can cost substantially more.

renovation contractorCommunicate firmly. The 3 things that contractors will continually try to compromise are workmanship, costs, and time. You have to be very clear on your expectations without deviating from them. Any hesitation from you can be a sign for a contractor to go for the kill. During work-in-progress, you have to call out any problems immediately. The longer it takes for you to communicate them, the more advanced the works. And the more advanced the works, the less likely they will remedy problems for you.

Get 3 quotes. You will only be able to get a feel of the market prices if you have quotations to compare with each other. Surely you cannot be naive enough to just sign up immediately with the first and only quotation you obtained. There are hundreds of contractors and interior designers around. You should get 3 to 5 quotations at least. Even after that, negotiate with the best value offer for a better price. Very often you can find a big discount for car insurance as long as you source for more quotes. You should do the same for contractors and interior designers.

Payment terms. Interior design firms might be harder to negotiate on payment terms. But contractors are flexible on them as long as the terms are fair. Payment term are the scheduled portion of payments that you will commit to when specific milestones are met. For example, 10% on signing, 25% on commencement of works, etc. Don’t forget that contractors require working capital to keep functioning. This means that they need cash to import your materials and pay their workers to renovate your house. Being too stingy on payment terms can hurt you. Draft a payment schedule based on milestones you are comfortable with.

Black and white. There are just so many minor details regarding renovations that nobody can remember everything that was previously agreed. So you have to write down all the gist in discussions and agreements. This is to both serve as a reminder to you and also a form of evidence when there is a disagreement in future on what was previously agreed on. Because while oral agreements can be easily brushed off, written notes are less easily debunked. Contractors will promise the sky before you sign up and say that everything is possible. Only after later into the works do you realize that a lot of things you want are not delivered.

On a final note, approach your relationship with your contractor fully expecting a confrontation or two. If you do go through a whole project without any disagreements, arguments or awkward situations, you are probably being an easy target.

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