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I'm about to have renovations done on a home that I'm going to rent for a year or so, and then sell. As a young single woman with no knowledge of these fields, I'm afraid I might get screwed over. To help soothe my anxiety, I'm wondering if there are things I can do if things go wrong - i.e. work is not done to my specifications or is faulty in some way. Any steps I can take to not only prevent this but also remedy?
Ideas I've had so far:
-thoroughly investigate contractors' licenses, any reviews I can find, etc. Get recommendations from real estate agents, property managers, etc. Interview at least 3 before choosing one.
-"hover around" while work is being done. I'm not sure if I'll be able to stay at the house, but even if I can't, I'll be sure to stay nearby so I can come and monitor things during the day. I don't know anything about the technicalities of the work but will at least be able to note the general vibe and figure out if things at least look right.
-I actually just set up a camera system that continuously records video. This could be useful later on, I'm assuming, though I don't have it set up for the entire house, only certain areas.
If things don't go well, I can always sue later, correct? I'm assuming there's always insurance involved.
Hire an architect to oversee the project on your behalf. They can write a document specifying workmanship and materials and they can also do site visits.
Take lots of pictures so that you have a record of what was done.
Make sure that the contractor has an insurance bond.
I'll second having a professional on board to keep an eye on things on your behalf. You want someone who is independent from the contractor. An architect would be best, but there are also construction inspectors and construction project managers who can do the same thing. In order for them to do their job, there needs to be a written specification of the materials and practices that you expect.
And I strongly agree with taking pictures, especially of anything that will eventually be covered up or hidden. Also take pictures of, or keep the packaging from, any materials used on the job. The mere fact that the contractor knows you're doing this can help keep him honest.
If you do your homework before hand and find a reputable contractor, hopefully you'll never need these things.
Make sure the contract specifies a progress and payment schedule. As the contractor reaches certain milestones, you will pay a certain amount. The level of detail will depend on the scope of your project. Don't pay up front for materials or pre-pay for labor.
Specify a retainage amount (typically 5% to 10% of the contract value) that will be withheld until all punchlist work and clean-up has been completed and all lien releases, warranties, instruction manuals, etc. have been provided. Nothing incentivises a contractor to make you happy more than holding his final payment.
Some States/Cities have regulations plus regulatory offices to oversee contractors. Contractors should be licensed, bonded and have liability insurance. You have recourses back to those regulatory offices if you have complaints.
Check for that in your area.
Yoe have some great ideas already! Where are you located? You are right in getting your facts straight about contractors law now. Also research and document the retail costs of ALL of the anticipated materials and labor costs if possible- you can average some of the projections posted on homewyse with just a few minutes time expenditure Homewyse - Smart Home Decisions
so obviously front load the whole project with lots of research. A agree with getting a third party advocate involved and having a camera system great too.
I like the idea of having an architect,but, maybe a really good property inspector or another contractor do in-progress inspections may be as effective and save some $ - compare and contrast.
The scope of the work is also a huge deciding factor in everything- make sure your contractor and consultant really check out the areas surrounding the renovations you plan on- missing things up front can cost you in change orders later.
I don't buy the whole percentage up front concept- why would a successful contractor need money up front at all? Drs. don't ask for it, nor do auto repair shops etc... just set up a payment schedule as already mentioned -one that YOU design.
You are on the right track- insurance and lawsuits are not really needed in most cases ,especially when you are doing some great planning and are going to hire great service people. Just know how those things are handled if need be,but, really keep your focus on doing it right the first time.
The #1 problem with renovations is the homeowner not "speaking the same language" as the trades people. Even if the tradespeople hired are primary English speakers (which increasingly is not the case...), very few homeowners have the appropriate technical vocabulary to ensure that all tasks necessary are budgeted for, carrier out in timely manner, and done with professionalism to ensure longevity.
Too often when the contractor hears "rent out place for year and then sell" there are assumption made that work gets done in such a way as to look ok for a year or so and is "good enough". Sadly when a rough-on-things renter then abuses the place the landlord has to spend money for emergency repairs and costly reworking before selling.
Almost certainly smarter to flip upon completion!
If the OP has neither the experience of how to do things right, nor connections to trustworthy folks that have been involved in such things they are setting themselves up for a huge loss.
There are some credit unions that partner with tradespeople or community colleges to offer "mini-courses" like "renovation 101" or "household remodeling for new property owners" I would strongly encourage such education.
It may also be worthwhile to seek out a professional General Contractor that has experience in renovations. Typically such a GC will supervise a complete crew and / or have relationships with speciality sub-contractors lie plumbers, electricians, finish carpenters and painters that will all be scheduled to do their work efficiently. I would caution that though using such an important an intermediary may appear to cut into potential profits, it really is very smart for a homebuyer with no skills. The alternative, of getting in way over your head, can quickly result in financial ruin as work spirals out of control and budget overruns leave critical tasks unfinished...
I'm about to have renovations done on a home that I'm going to rent for a year or so, and then sell.
If the plan is to sell... then do that NOW.
Clean and fix and neutralize? Sure but not more than about $1000 in materials.
Then SELL. Get the most you can and move on.
Quote:
As a young single woman with no knowledge of these fields, I'm afraid I might get screwed over.
Let me count the ways.... Again, SELL it now.
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