The time-lapse camera is focused on a parcel of land, but nothing happens for several seconds. So much has to be done before even the first physical step of excavation can start. Off-camera, you have met with an architect or designer, possibly even a landscape architect and interior designer. You have seen your dreams realized on paper, but now it’s time to talk with someone who can put those plans into effect: a general contractor—sometimes referred to as a “GC.” This is someone who will be handling all the supervision and coordination of sub-contractors for the project. Typically, you can expect to pay 10% to 25% of the total cost (of labor and materials) as a fee to a general contractor.
That percentage is why some people choose to do their own contracting. The decision is a purely personal decision, but it must be informed and with a full understanding of the duties and responsibilities you are taking on. Home building or remodeling is a significant undertaking. You have to consider not only your own knowledge and expertise, but the amount of time you can commit to the job, whether you have all the necessary licenses and permits to act as a general contractor, and if the amount of money you save is worth the time and effort you put into it.
Full-time general contractors offer economies of scale with time, materials, and experience in dealing with various sub-contractors—experience being the most valuable asset. Suppliers of materials, however, seldom will give the kind of deep discount to a do-it-yourselfer as they would to a full-time general contractor; so what you save in paying a general contractor, you might end up paying in the cost of materials anyway.
Another consideration in acting as your own general contractor is in hiring sub-contractors. You probably don’t have a working relationship with electricians, plumbers, carpenters, masons, and other trades people in your area. Instead of hiring one general contractor, you’re now in the position of having to hire ten or more sub-contractors, and you have to get bids and evaluate each one of them—something that a full-time general contractor has already done many times over. A good general contractor should know who does the best work at the best price, and you won’t have to be involved in that hiring process (although you should have some idea of who the general contractor will be hiring).
One alternative to hiring a general contractor or acting as your own is to hire a “construction manager”, the main difference being that a construction manager does not assume responsibility for the overall management and coordination of the project. You assume that role. You’d be responsible for hiring sub-contractors, dealing with suppliers, etc., but the construction manager would help in these decisions and act as an on-site supervisor to manage the work. Still, you’ll be paying typically 10% of the construction costs for a manager of this type, so it might not save you much money over the life of the project.
So, how does one find a general contractor? Aside from the phone book, the best way of obtaining a listing of general contractors is from a local building association or Better Business Bureau (in fact, you should always check with the Better Business Bureau for any contractor before you sign a contract). From there, you can start making phone calls and compare the various companies. In most cases, however, this is not a very time-efficient way of choosing a contractor.
One good way is to watch your own neighborhood—and go to neighborhoods similar to yours—to look for contractors working on job sites. A polite, brief, introduction is adequate to get a business card and a description of their services and availability. If you are dealing with a large general contracting firm, then the person you talk with on-site might be referred to as the “project manager.”
Once you’ve narrowed your choices down to three or four contractors, and you’ve talked with each, ask for bids and references. Some contractors, especially in a hot building market, might say that they never bid on home projects, but rather build by a “design/build” contract structure, where once you decide to go with their firm, they are responsible for both the design and building phases. This has its advantages in that these are usually reputable firms who have a lot of experience and frequently have their own in-house designers. This can save you some money. However, it also doesn’t usually give you the most flexibility or best cost-effectiveness. And you might not be able to walk away from a “design/build” contract with at least the design blueprints to take to another contractor.
For most remodeling and home building, you will be comparing contractors and analyzing their businesses and bids. But how do you know what a fair bid is? How do you decide that a contractor knows his business and is presenting you with an accurate picture of what the building or remodeling will cost and the professionalism and quality of their work?
One way is to review (on your own and with each contractor) what is referred to in the building industry as the “sixteen divisions.” This is simply a way of dividing up the work and materials into sections so that nothing is left out and no surprises come up during the building. Also, when you first start shopping for contractors, if you make them aware that you’re familiar with the sixteen divisions, they’ll know that you have at least a basic understanding of how the building process works. Not all building or remodeling jobs include all of the sixteen divisions, but it’s how most contractors organize their work.
The “sixteen divisions” are a good way of organizing the work and materials that go into a building or remodeling job, but there’s also a personal side to working with a general contractor. For some people, this is the deciding factor—though too often people regret hiring a contractor solely because he “seemed nice.” The contractor must be experienced and competent, but he also must be able to work with you over a sometimes lengthy amount of time.
The contractor will be your partner in whatever building dream you are trying to realize so be sure you are comfortable on a personal level with him. Contractors have a professional interest in making sure you are happy, and this is made easier if they are good at relating technical and complicated information in an easy to understand manner. They’re not trying to be your best friend, but they should have your best interests in mind. As in any human social interaction, someone who comes across as condescending, secretive, or disrespectful, is not someone with whom you want to get involved in a major building project.
Some questions to ask a prospective contractor are: What is your availability? What size jobs are you currently handling and how many? Is your work crew full-time? Will you be on-site once construction begins? What kind of contract and pay schedule do you like to work under? What licenses do you have? What’s the permit application process like for a job like this, and what’s been your experience in the past in applying for local licenses? Also, if you do go over plans and blueprints with a prospective contractor, ask for his opinion about the plans, and if he sees any potential problems.
Check out two or three references for each contractor, and be sure to ask for references from people whose project is similar to yours. Once in touch with the references, ask detailed questions about how professional the contractor was on the job, whether the work was done well in a timely manner, and if the person would recommend the contractor to a friend of theirs. Also, how close to the original budget the contractor came; was the site kept clean; were any liens placed on your property by unpaid sub-contractors; and if they would work with that contractor again.
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