It's no secret that owners are staying longer in their houses these days and it's no secret that people remain cautious about spending. Yet fixtures wear out, décor becomes outdated and home remodeling becomes crucial.
With today's economy, many people think it's safe to go with the lowest bid for a remodeling project because contractors are hungry for the work and this guarantees a good job.
Wrong. That couldn't be further from the truth, many in the remodeling industry say.
In fact, because of our economic climate, homeowners ought to be doubly wary of choosing the lowest bidder, especially if there is a wide difference in price for what you think will be the same work, building contractors said.
"It starts out with the scope of the work," said Mike Pudlik, owner of Legacy Design and Construction Inc. in St. Charles. "What the client thinks they're getting and the scope of what the contractor is offering can be different."
If one quote for a bathroom or kitchen redesign is $10,000 less, there's probably a good reason for it. The first thing homeowners need to do is compare apples to apples, which means take the quotes for the proposed job and compare them thoroughly. Go through every line item and ask questions.
"Not every contractor details specifications, but what a contractor should detail is what's included in the price," said Bryan Sebring, owner of Sebring Services in Naperville. "If you ask them upfront and they don't want to give you details, then they will never be honest with you."
Although methods differ, reputable contractors are thorough in how they quote. Daniel Murphy, of Murph's Customs LLC in West Dundee, includes three sections in his contracts.
"The first is a summary page that includes base cost, what's included in that, and allowance items," Murphy said. "The second page is work order specifications that may include demolition, concrete, excavation, plumbing, electrical, HVAC (heating, air conditioning and ductwork), and any finishes that may be involved such as tile or paint work."
In addition, Murphy includes documents that provide legal protection for both his company as well as the potential client. Among the literature he includes is the "Know Your Consumer Rights" pamphlet from the Illinois Attorney General's office, which outlines how homeowners have the right to cancel a contract within a specified number of days.
Savvy consumers will take a look at line items and question why they're not included in a particular quote. Joan Baltusis of Naperville had her kitchen, master bedroom and bathroom in her townhouse remodeled by Sebring. In comparing quotes, she found a lot of discrepancies.
"I asked one contractor about the under-cabinet lighting in the kitchen and the response I got was, 'Well, you didn't ask for it,'" she said. "It's not just the hourly rates or quality that's not detailed, it's whole pieces that are left out."
One area where there may be considerable differences is in the allowance portion, which is basically materials that a customer must choose, such as tile, flooring, countertops, cabinets and the like. Even here, though, you can work with your contractor and indicate you only want to spend a specific amount of money on items that will be purchased.
Not knowing what you want going into a project is an almost universal problem, and one that contributes to the sense that the homeowner is being cheated in the end. Most people only know they want a new bathroom or an addition. They have no idea what goes into doing the work. As a way to offset this, your contractor should ask you specific questions pertaining to how long you plan to stay in your home.
The scope of a project for someone who plans to sell in several years will be different than for someone who plans to stay in the home indefinitely. The project's scope can affect the way the project is quoted, too.
"My belief is that with a larger project, you need to go with an architect for design," Sebring said. "You need to pay the architect and this needs to be spelled out clearly in the contract."
A number of other areas pose red flags, too. One is the contractor's certificate of insurance. It could be nonexistent.
"This is easy to figure out because you can ask for their certificate of insurance to be sent to you," Pudlik said. "Go one step further and call the company because sometimes they take an old certificate and change the dates."
Another big area where some contractors try to cut corners is in obtaining and paying for a building permit from your municipality. Some contractors will tell you you don't need one; however, if your work involves anything with electricity or plumbing, you're going to need a permit no matter how small the scope.
"If someone tells you that you don't need to pull a permit, it probably means that they're not insured," Pudlik said.
Beyond that, other problems could arise, particularly when you try to sell your house. Obtaining a building permit means that an inspection needs to be done. If remodeling work is evident and there is no track record to prove that a permit was pulled, you could run into difficulty selling, not to mention that by not obtaining a permit you are essentially breaking a law.
"The bottom line is you run the risk of not being able to sell your house because many municipalities are requiring you to prove occupancy at the time remodeling occurs," Sebring said. "In addition, many realty companies are requiring permits for work that has been done. More people, these days, are checking up."
Not pulling permits is a particular trick of contractors who chase storm damage repairs, Pudlik said. Many of these firms are also out-of-state companies who may disappear when problems arise. Bottom line is, not securing the permit is not worth the money saved.
Another area that people should check out is whether the contractor actually does good work. One of the ways that this can be accomplished is by checking to see whether the contractor is a member of any pertinent organizations such as NARI (National Association of the Remodeling Industry) or NAHB (National Association of Home Builders). Being involved with such an organization is an indicator that the contractor keeps up to date with various industry issues and provides quality service. Experience and certifications, which speak to the contractor's knowledge, also come at a price.
That was important for Dan and Kay Jones of Warrenville when they selected Legacy to perform the renovation on their kitchen and master bathroom. In addition to considering pricing, Dan Jones said it was important for he and his wife to see that the company was reputable.
"Pricing was definitely a consideration and we got references on work," Jones said. "But we also checked out the NARI website and saw that Mike (Pudlik) had won some awards. That was important, too."
Check references, too. What others say about your contractor is important and could be the make or break point for accepting contractor services. Not only may you want to check other clients, asking other businesses such as suppliers is a good idea. That's what Joan Baltusis did before she agreed to a contract to have Sebring Services remodel several rooms of her condominium.
"Bryan offered names of both suppliers and customers that I could contact for references. Upon calling them, I found that he paid his bills on time, and the vendors enjoyed working with him, which is especially important when the economy gets bad," she said. "His customer references were more than happy - they were delighted - to have hired him."
Two other areas homeowners may want to consider when selecting a contractor are making sure you understand that unforeseen circumstances may raise the final cost, and, secondly, ensuring the payment schedule fits the work being done.
Murphy included an "unforeseen circumstances" explanation in his contract to build an addition for Dave and Rayelynn Damitz of Schaumburg, which calls for a trench foundation.
"If for some reason the walls of the foundation walls start caving in after the concrete is poured, you have to do additional work and this raises the cost," Murphy said. By putting such a clause in the contract, the contractor is letting the consumer know that such an event could, but is not guaranteed, to happen. Thus, there are no surprises.
Similarly, Murphy usually specifies five or six payments in his contract.
"You want to have progressive payment based on what's being done," he explained. "I always hold back 5 to 10 percent of the total cost until after completion until the client has gone through everything and puts their furniture in. This gives the homeowner the security of knowing that I'm not trying to get out and run with the money."
Even with taking all of these precautions, there are still things that can go wrong.
"There are so many ways that (contractors) can be chintzy that the consumer won't know what you're doing," Sebring said. "When you get details, you have less of a chance of that happening."
Trust is a huge factor. Rayelynn Damitz said there was a big difference in the way she received her quotes from contractors bidding to build her addition.
"One dropped it off, the other e-mailed it to us," she said. "Daniel sat down with us for two hours, going over every detail of the quote. I could tell that he's not in it to make a buck and really cares about his customers."
Baltusis agreed. "How do you put a price on trust? You can't."
Nevertheless, the process of selecting a contractor is difficult, as Baltusis noted.
"It was a bit daunting to do all of the research," she said. "I didn't realize how important trust was in the process."
Sebring said potential clients are always asking for him to cut them a deal.
"You can either use the experience of a contractor to help you or to hurt you," he said.
The bottom line, however, always comes down to the homeowner. Obtain the most complete quote possible, then educate yourself by doing research and asking questions. Doing so will help eliminate surprises and increase the chances of having a good experience with your chosen contractor.