Houston’s floods the last few years have taught us a lot about best practices for new builds and renovations in our area. Unfortunately, the floods have also dredged up inexperienced and sometimes unscrupulous contractors and subcontractors who’ve taken advantage of people affected by the flooding.
Two years after Hurricane Harvey, complaints about contractors and builders are ongoing and have been well documented in the news. After the flooding, a lot of people saw new opportunities and jumped into the field regardless of their experience. As a result, we still meet heartbroken people that trusted their contractors or subcontractors and were shocked to be abandoned mid-project, get substandard work, or have contractors just take off with their money. It’s a situation that’s left a lot people out a good deal of money and with little trust now for contractors.
In Texas, a builder or a contractor doesn’t have to be a licensed professional. That makes it hard to prevent unprofessional contractors from continuing to work, even after they’ve wronged multiple clients. It’s as easy as changing their phone number or their business name, and soon another client will be in the same unfortunate situation.
Of course, nobody can trust in anyone 100%, and there are force major events—ones that are just unforeseeable. But, by being careful and looking for a trusted contractor or builder with experience, you can help avoid getting taken advantage of.
We know first-hand how stressful the building or remodeling process can be, with its array of decisions and the big costs involved. Choosing a responsible and a reliable contractor or builder will make the process much smoother and less stressful.
We went through the process of picking sub-contractors for our business and we learned lessons that can also be applied to choosing a great contractor or builder. As you embark on your project, consider the following:
1. Get a referral. References are crucial when looking for a contractor. A beautiful website and number of years in the business aren’t enough. Your decision can’t be built solely on these factors, especially when faced with charismatic salesmen who often have great negotiating skills. Best of all is a reference from someone you know—a friend, family member, or a neighbor. When that’s not possible, check reviews. Don’t just skim to see how many positive and negative ones there are, read the full reviews. Also, unfortunately in today’s day and age, fake reviews are common. Businesses can even buy fake reviews. Be wary of reviews with tons of grammatical mistakes—many fake reviewers are based on foreign countries—and a sudden addition of positive reviews.
2. Be smart about payments. We learned that when a subcontractor asks for money for materials, unless you know them very well, offer to buy the materials yourself or pay the subcontractor when they deliver the materials to your property. This lesson can be applied to choosing a contractor as well. Know that if you’re a new client, an experienced and responsible contractor won’t ask you for a down payment on your first project. You should be able to pay the first installment once they’ve completed a portion of the work.
3. Make sure progress matches money paid. As your project progresses, try to make sure your level of payment and the level of progress your contractor has made is about equal. As the contractor invoices you, make sure invoices are for work completed. If part of the project is only halfway done, you should only pay for half.
4. Wait for the final payment. As you reach the 80% mark on payments, your contractor will have covered all of their costs. To complete the project, they should remain incentivized, so only make the next and final payment at project completion.
5. Push for a solid contract. A successful project starts with a detailed contract. It will help you avoid any misunderstandings as your project gets underway. Most contracts cost more to litigate than the cost of building or renovating, so in most cases it doesn’t make sense to hire a lawyer to draft one. Instead, work with your contractor to create a clear document outlining both of your obligations. Describe your project’s scope, payments and termination terms in detail.
We’ve found that subcontractors who are proud of their job are keepers. That also applies to contractors. Find one who takes pride in their work and you’ll be well on your way to having an enjoyable homebuilding experience.
