Ask McEnearney: What’s Important When Hiring a Contractor for a Renovation Project?

This week’s Q&A column is sponsored and written by Kristy Crombie of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Kristy at 571-969-1774 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: What’s important when hiring a contractor for a renovation project?

Answer: As realtors, we are often asked about home renovations, whether for a new home or preparing a home for sale. We certainly know a thing or two about which renovations add value to a home and which are particularly appealing to potential buyers.

And, we often suggest homeowners consult a designer, especially for larger projects, since doing so will be well worth the cost in order to achieve the results you want. But the most important factor in determining whether you achieve a quality outcome is the quality of your contractor.

Here are some key considerations in working with a contractor:

1. You should work with a contractor who is licensed and insured. One of the ways to verify a contractor’s license is by visiting the Department of Professional and Occupational Registration (DPOR) website. This agency issues state credentials — licenses, certificates or registrations — to those qualified to practice in regulated professions.

In short, they protect the public by verifying competency, investigating complaints and upholding professional compliance with state laws and regulations. Their website is user friendly and is state specific. Most important, you should feel comfortable with whomever is working in your home. In addition to the DPOR website, check your local or state consumer protection agency website to protect yourself. It is also worthwhile to check the Federal Trade Commission website for additional information and protection information.

2. For large renovation jobs, you will likely hire a general contractor to oversee your entire project. General contractors (or GCs) will often hire sub-contractors for specific work such as tiling a bathroom or installing hardwood floors. Sub-contractors (subs) should also be licensed and insured. It is the responsibility of the GC to hire and communicate with subs and ensure that their work is being done properly and in a timely manner. It is also the job of the GC to pay the subs directly, but within your agreed-upon budget.

3. Your general contractor should apply for (or “pull”) permits depending on the scope of work being done. Each county and state has specific rules and regulations on the use of permits. In addition to safety, permits also serve as a way to update county tax records, as well as make sure the home’s features are accurately recorded if there is ever an insurance claim (it is not unheard of for insurance claims to be denied related to damage to additions/changes that were never permitted).

Visit your county’s official government website for specific information on building permits, whether they are necessary, and how to apply for them. This same website will also provide up-to-date code information.

4. Plan to interview at least four or five different contractors to determine if they are a good fit for you. Recommendations from Realtors and online reviews may help you narrow down the initial short list; also remember to confirm relevant licenses through the DPOR website. Try to contact at least three of the contractor’s references for projects with the same scope of work. Before-and-after pictures are very useful; if possible, see the work personally.

5. Clear communication is a necessary practice in life. This is especially true with contractors when emotions can run high after the initial honeymoon period. It is imperative that you and your contractor work together to write both clear estimates and an iron-clad contract. Be sure to note in the contract who will be in charge of your project and how you will communicate with them. As part of your contract, ensure that any design or material alteration is agreed through a “change order”.

Change orders must be in writing and agreed to by both parties, specifying the cost, timing and any other implication. Another contract feature is the inclusion of a penalty clause, such as a percentage deducted by the final payment if the work is not completed before a specified date. In contrast, the contractor may include penalty clauses if the homeowner fails to secure materials in a timely way or is delayed in making design decisions. The contract should also be clear on what happens when an item is lost or damaged during the renovation.

For example, if a stainless steel refrigerator is damaged during the installation, who pays for its replacement. Revisit your contract often to be sure that you and your contractor are each doing your part.

6. A general contractor will pay subcontractors when their work is completed or when project milestones are met, and thus the contract should specify when the homebuyer must make partial payments. As a way to save significant money, not to mention ensuring control over your ultimate design, shop for and source materials yourself (double check that the contract is clear about what is or is not owner supplied). Be sure to consult the contractor before your purchase on any technical specifications, such as plumbing or electrical fixtures.

Keep in mind that if the homeowner makes the purchase, the contractor will not be responsible for any warranty or exchanges and related delays. If you are doing a whole-house remodel you may want your contractor to price out projects individually, rather than as an aggregate. For some jobs that require a different skill set, you may want to contract out separately.

For instance, identifying and independently supervising a painter may save you money since it avoids the contractor’s overhead charge. But most contractors are likely to want to control as much of the work as possible and will resist outside contractors doing piece-meal jobs.

7. You and your contractor should be organized about materials and supplies, especially for bigger projects. As the homeowner it is helpful to have a dedicated storage area for materials to avoid items being misplaced or accidentally tossed away. Keep a spreadsheet of the number of tile boxes and light fixtures as they are delivered.

Also, don’t forget to immediately check upon delivery that the items are in good shape and have not been broken. At the end of each day, check the work that has been completed and the owner supplies that have been used. Leave sticky notes in various places with questions or comments. As part of record keeping, note serial numbers for appliances, put manuals aside, and cross-check the list with the items prior to installation.

8. Take pictures as progress is being made and be sure to document any relevant discussions with your contractor, such as an email to reflect what was agreed to. It’s also a good idea to note significant absences of the contractor in case a dispute arises about deadlines not being met (it’s pretty common for contractors to be working multiple jobs even if they promise you they won’t).

When the hammers and sawdust are flying, it’s easy to get lost in the moment and forget what was discussed. The he-said she-said game does not usually end well for anyone. It’s fun to document — through pictures and notes — the work as it’s being done. Not only is it fun to have before-and-after photos, but you’ll be able to refer back to your notes and learn for your next job!

Kristy Crombie is a licensed real estate agent with McEnearney Associates, Inc. in Old Town Alexandria, VA. Having lived here for more than 20 years and taught in our community’s schools, she understands how challenging finding the right home can be in our area. Contact Kristy at 571-969-1774 to help you navigate the buying and selling process and realize the tremendous opportunities of homeownership.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703-549-9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria