Whether you’re building a home, just bought a home and doing major renovations, purchased a business and doing the necessary remodelling or just decided to upgrade your home (and perhaps use the Home Renovation Tax Credit!), they have a common element: you need to deal with a contractor and trades people.
If you are building a home and using a Real Estate Agent, I would strongly suggest you hire a Real Estate Agent who is experienced in the building process. Filling out paperwork is one thing but understanding what can go wrong is very important. The same would apply to the Lawyer that you use, make sure that they have lots of experience in dealing with new home construction. Believe me, these two together will save you tremendous grief down the road.
One of the biggest problems I have seen over the years is communication. What you want and what the contractor thinks you want can be two different things. Be very explicit and simple, even to the type and color of door knobs. Oh yes, I almost forgot – EVERYTHING is to be written down, signed, initialed, dated and everyone given a copy. For people who are just doing renovations, be sure to have a lawyer look at it. If you have problems down the road, he/she will be representing you so why not let them be part of the process from the beginning.
A good builder/contactor will not require you to sign anything until you are both on the same page. For example: what you want for flooring, what you want in the ensuite, the various paint colors of the rooms or how your kitchen will look like. Most contractors today will give you an allowance for lighting, flooring and the kitchen. Go to the place where they will buy these items from and see what you are getting. It is very important to not sign anything until you do. Make sure the amounts will satisfy what you were expecting – both in quality and quantity. Remember that show homes are nice to visit but most cases, it is full of upgrades and not what you will get in the home that you just purchased.
Whatever your project is, be sure to get quotes from other contactors. But make sure that you are comparing apples to apples. Often I hear that was not included or I thought you meant this. Do your homework. I tell people go to open houses and take pictures of the kitchen you want or that living room – it is also better to show your contractor a visual and include in the contract.
I tell people to talk with people who the builder/contractor has done work for. Calling references is not always the best way to do this. If you left a job because you had a dispute, are you going to ask that person for a reference? Get your lawyer to inquire from other colleagues. Check with your local New Home Warranty or whoever the builder uses and see if they have many complaints. But the best is snooping around and finding people they did work for. Don’t be genetic with your questions either. Don’t just ask if they a good builder. Ask if they finish on time (and if they were compensated if it was not finished on time), when they wanted changes if the contractor was cooperative, did they come back to fix items, were the allowances (monies) enough to get flooring and kitchen cabinets, did they clean up after they were finished and would they use them again?
Be sure that whoever you hire has insurance on their workers as well if insurance for home damage if they cause it, WCB coverage and that all the sub-contractors have insurance and also have WCB coverage. Be sure you ask to see these policies and be sure you check to see whether they are up to date.
I believe in the underground economy but when you try doing this with new home construction or renovations, remember there is no paper trail meaning it is very difficult to take the company or people to court. Also, if you want to claim the home renovation tax credit, you need to keep your receipts incase you get assessed by Canada Revenue Agency.
After you choose your builder/contractor the most next important item is the contract. Be sure it is very detailed. What they are going to do, the time frame, whether they compensate you if the work is not completed on time, what work you are getting done and the exact items to be installed – have a schedule of all the materials being used and allowances granted, a guarantee and what that guarantee entails and length of time you have to collect the guarantee. When you are building, the law provides that there is a builder’s holdback lien (talk with your lawyer about this). As well as if all the work is not completed, be sure you hold enough monies back not only for the item(s) but also to have it installed.
A Real Estate Agent and Lawyer with lots of experience in New Home Construction can go a long way in making your project or new home a pleasant time.