Thinking of Remodeling? How to Avoid Getting Burned
Thinking of Remodeling?
How to Avoid Getting Burned When Renovating is Hot
If you’re like 52% of the American homeowner population, you may be remodeling some part of your home in the next year. That is approximately 41,237,200 people or 3,436,433 people each month! Collectively, that’s $352 billion spent so far in 2021. (An increase from $339 billion in 2020 and up significantly from the $290 billion spent in 2019.) [source]
This increase in renovating combined with halts on production due to the pandemic means, as you can probably guess, long wait times, material shortages, price increases, and a laundry list of other things that may cause your planned home renovation to go off the tracks. Thankfully, we have created a list to keep you from getting burned when remodeling your home during the last few months of 2021 and into 2022.
Never Pay for Your Renovation in Full Up Front
When researching your project, you may find that every company has their own guidelines for receiving payments. As a rule of thumb, steer clear of anyone asking for full payment up front. This leaves little to protect you as the homeowner from shoddy work, or from your contractor skipping town without completing your job. Instead, it’s a much better choice to select a contractor that provides a payment schedule up front that is generally based on progress milestones. A payment schedule will provide assurance that you won’t get left hanging mid-job and allows the project to progress while maintaining a trusting relationship and accountability between both parties.
Check That Your Contractor is Licensed and Insured
When researching contractors, always check that they are licensed and insured. On the off chance that something goes horribly wrong, allowing a contractor to work on your home without insurance or licenses can put you and their employees in a sticky situation.
In addition, check that your contractor will be pulling the proper permits for the work to be completed. Renovation work done without a permit can have major consequences when it comes to your home. If caught performing work without a permit, you may be required to tear down and re-do the work at your own expense. On the contrary, work done with a proper permit will ensure that everything is to code and will ultimately add value to your home.
Do Your Research
How to Know What Kind of Contractor You Need.
There are many contractors out there to choose from and you may have a lot of questions regarding how to select the one best suited for you. Knowing the type of contractor you need starts with creating a list of services desired since each contractor will offer something different based on the way they are structured. For example, if design services are something you desire then you would likely research a company structured as Design-Build. On the contrary, if you do not need design services because you already have your materials selected and purchased then you would likely research a company structured as a general contractor. HERE is a great tool that may be helpful in determining what type of contractor is best for you.
You may also notice that there are many avenues you can take when embarking on a renovation. We have broken these methods down into 3 main categories: Owner Build, Design- Build and Design-Bid-Build. The diagram below explains the homeowner’s role and responsibilities within each scenario. Knowing which method you prefer will also help you narrow down which type of contractors to call.
Select a company you make a connection with
Think of the selection process as a dating scenario, and the initial consultation is like a first date. You would likely not go on a second date with someone who didn’t listen to you, or someone who was overly pushy with their agenda. The decision to renovate is a big commitment of your time and resources so it is incredibly important to have a trusting and transparent relationship with your selected contractor.
Style is Important
Before reaching out to anyone, spend some time looking at photos of finished projects from your top contenders. Do you like what you see?
If you are looking for an edgy new kitchen, you wouldn’t want to pick a company with images of conservative cabinetry, flooring, etc. On the contrary, if you are looking for a more conservative or traditional appeal, the opposite would apply.
Never Go with the Lowest Bid
You have done your research on various companies, understand what your wants/needs are, and are finally ready to get some bids. You have a few consultations, and after receiving estimates back the investment range was a tad higher than you anticipated but for the most part every company was within the same ballpark - except one. The quote sounds too good to be true, but is it?
Generally, if it sounds too good to be true, then it likely is. The company could be underquoting only to hit you with “unknown” expenses later in the job, costing more in the long run. These companies may knowingly do this to undercut and outbid other companies at a surface level, but are not being entirely transparent.
Your contractor may not provide you with quality work!
If the quote is significantly lower than other companies you have reached out to, make sure to check references and reviews before agreeing to a job. Remember, you get what you pay for and remodeling your home is a major investment. Do it right the first time to avoid a major headache a few months or years down the line.
If you want to feel assured that you are making the right decision, ask your friends or family who they have used in the past. You will get honest feedback from those you trust and this will help give you peace of mind when embarking on a remodeling project.
Be Skeptical of Companies that are Available Immediately
You may have noticed that most companies you have contacted recently have a wait list or a start date quite a few months in the future. Waiting to start a project isn’t always a bad thing. Think of it as having a choice between two restaurants. You pull up to the first and there is no one in the parking lot. As you walk in you also notice there is no one at the bar or seated at tables during the dinner rush hour. You get an uneasy feeling, so you then look across the street only to see another restaurant with a line out the door and smiling patrons. Which restaurant would you assume has better product and quality of service? The remodeling industry is no different, so be weary of those who jump on a job right away.
Know That Materials are Hard to Get Right Now
The last 18 months have had a major impact on shipping and production of many building materials, creating back orders and long lead times. Imagine having your kitchen all demolished and ready for renovations only to have your contractor delay your job due to material shortages, leaving you without a kitchen for nearly 3 months! This is another reason to be weary of companies who want to start your project immediately.
A reputable company will communicate honestly with you regarding material lead times and plan your job accordingly. Material shortages or delays are not always predictable, but the right company will provide you with temporary solutions in the event something is unexpectedly delayed.
Be Aware of Unpredictable Pricing Increases
One side effect of material shortages with an increase in demand are price increases. The industry as a whole is seeing material cost increases of close to 25% or more. We’re not just talking lumber, we’re seeing it in cabinetry, windows, doors, and other pertinent materials that make a renovation possible.
Before signing a contract, ask your contractor if there is any opportunity to order materials ahead of time. Once all of your selections have been made, investing an additional deposit to order materials can avoid the headache of unexpected costs in the future as well as shipping delays that may occur.
Some Key Take-a-ways
The demand for materials is high, driving up prices and causing material delays.
Be skeptical of companies who offer to start right away or undercut with the lowest bid.
Select a company that lines up with all of your needs including pain point solutions, style, and personal connection.
Never pay in full up front!
Check for licensing and proper protocols when it comes to remodeling.
Each year a good majority of those 41 million people remodeling will end up spending millions correcting botched renovations. You can avoid getting burned by taking your time and watching for red flags during your consultation and throughout the quoting process. Remember that good things take time and there is certainly no good reason to rush or jump into a renovation without the proper planning.
Are you looking to have your home remodeled in the Cleveland area?
JENNA RAUS IS THE BUSINESS DEVELOPMENT MANAGER FOR ODELL CONSTRUCTION LOCATED IN WESTLAKE OHIO.