Should I remodel my home now or wait and what should I know about getting an estimate from a licensed general contractor?
This topic will be spread over three separate but equally important parts. The first is the budget, second is the scope of the project and third is the contractor’s estimate.
Budget by definition is “the total amount of money allocated or needed for a particular purpose or period of time.”
The difficulty in establishing a budget for a construction project is most people have no idea of what they can get done for a given amount of money. So the first thing is to consider the amount of money you can afford to spend or are willing to spend for your improvement. This amount may or may not be adequate to complete the desired project. It also could be too much.
How do you determine what is a sound investment for your improvement is based on a few sound investigations? One is, for example, a kitchen remodel, can be researched on the web of www.costvsvalue.com. As you will see, the national average for a major kitchen remodels job is $58,367. The recoup cost upon the sale of the house is $40,126 or 68.7%. Given this fact one must determine if the investment is worth the added value one might gain in the happiness of having a new kitchen. If you are planning to sell in the near future then it would not make sense to invest in a major kitchen remodel. If you are planning to stay in the home for another 5 plus years, then you will enjoy all the new amenities a new kitchen will bring.
If the value of your home is $450,000 and you owe $400,000 then this might not be the smartest move either. If you have more than 50% equity in your home and you have the capital for such an investment, then the only decision is to enjoy a new kitchen or not. Things to consider for this decision are function, efficiency, comfort, and prestige. Return on your investment and return of satisfaction are a difficult combination to make an objective evaluation. Will you be happier with a new kitchen? Who does the cooking will be happier. If the is the wife then the old saying make ring true: a happy wife is a happy life.
Once you have arrived at a budget for your project, the next step is to come up with a scope of work that fits your budget. This is a trial and error process. Many homeowners would like to have their project completed with a scope of work that exceeds their budget. Most homeowners do not know how to come up with a clearly defined scope of work. Usually, the scope of work which may include drawings and specifications are done by an architect, engineer, design-build contractor or certified construction specifier and occasionally a designer. Of course, as a design-build contractor, I would prefer doing the drawings and specifications, but it really depends on the magnitude of the project.
The scope of work describes the materials to be used and the quality of workmanship required. The drawing portrays graphically the extent and arrangement of the components of the structure. The specifications describe in writing the materials and the workmanship required.
The location address of the project and the specific area of work, (example: master bathroom) need to be included in the specifications.
The specifications and drawings become part of the final contract agreement which should include the start date and completion date.
The drawing should show the existing conditions of the structure, the areas of demolition, and the new arrangement of material elements. The specifications have three parts; 1) general, 2) products and 3) execution.
General should include; a summary of the scope, work included, room finish schedule, submittals, samples, product data, quality assurance, project/site conditions.
Products should include; manufacturers, materials, delivery, storage, & handling procedures mixes, field-construction mock-up, and pre-installation conference.
Execution should include; inspection, installation, and cleaning and protection.
This is sometimes a little over the top for smaller projects, but, one should make sure that the planned work of improvement is clearly defined before proceeding with the project. Having a clearly defined project assures you that you will get what you pay for and will not be hit with unwanted change orders.
For a sample of specifications see our website under residential, bathrooms and under commercial for a complete specification.
The Contractor’s Estimate
If you have established a budget and a scope for your anticipated home improvement project then your next move is to gather estimates. The contractors’ state license board recommends that you get three estimates. You may have more than three contractors to reach out to in order to get three legitimate estimates. Some contractors show up and decide after they leave that the job is not in their expertise or does not fit their business model, so will not submit an estimate.
If the estimate is based upon a clearly defined job scope one would think that the estimates should all be around the same price and then you just pick the person with whom you feel most comfortable. Wrong! Estimates will be all over the board. Some high, some low and some in the middle. If you pick the one that is too high you might be paying too much. Some contractors miss items because of sloppy estimating habits and have a lot of change orders for more money. If the estimate is broken down into categories, then you can compare and see where one is high or low. Some contractors sub contract all the work and then you may be paying for two profits and overhead margins. Some contractors do some of the work and have their own crews. No two contractors are alike. If you go shopping for a car and decide on an chevy with certain upgrades, then you can compare different dealers. If there is a price difference between dealers you still get the same quality car. This is because the car is built in a factory under standardized quality control guidelines.
The contractor you choose is the one responsible for the quality control. What are his/her qualifications? Does he have a license to do the project, will he pull a building permit, is he insured with both liability insurance and workers compensation? Has he done the kind of project you are requesting?
Look out for the contractor who does not have the experience required to complete your project to your expectations.