How To Renovate

EP32 7 Builder Red Flags

• Tash South • Season 1 • Episode 32

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Cowboy. Builders. 🤠

Two words I hear every time when talking to future renovators about their top worries about starting a project. 

So this weeks’ episode is here to help with that, it promises to arm you with the knowledge to identify those sneaky red flags that could save you from costly and frustrating renovation disasters. 

Inside I’ll cover 7 Red Flags you should have your eyes wide open to before hiring a contractor or builder. Including: 

1. Lack of Proper Licensing and Insurance
2. Lack of Detail On Quote Or Project Spec
3. Reluctant To Provide A Contract
4. Unable To Provide Any References
5. Unusually Low Bid
6. Poor Communication and Unresponsiveness
7. Insists On A Large Upfront Payment

From the importance of detailed quotes to trusting your gut, I cover it all. I’ve heard some sad and very upsetting stories over the years on this topic so this episode has always been in the making – please listen or revisit it before you start any reno project.

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Hi I'm your host, Tash South I'm an Interior Designer and Renovation Consultant.
Each episode of How To Renovate is short, but brimming with practical advice to help you manage your renovation project with confidence and success.

Grab some more renovation advice & free resources and become part of the South Place Studio Renovation Community at
https://www.southplacestudio.com/freebies

Everything I teach about renovation falls within my Five Pillar Process for A Successful Renovation, to learn more about the process, head to
https://www.southplacestudio.com/pillars


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Speaker 1:

Hey everyone, tash here and welcome back to how To Renovate. In this episode we are talking about something quite major. We are talking about builder or contractor red flags. So in this episode I'm going to give you seven red flags when you're looking to hire a builder or a contractor. So these are seven things you should look out for. But on top of these seven things, I also think what's really important is your gut feeling on when you're meeting with potential builders. You are going to be working on a large renovation project with this person and their team for quite a long time if it's a large renovation project, so anything from six months up to over a year. So you need to know, you need to feel that you can work with this person, you can communicate with them. Hopefully you can overcome any issues that may arise. So I think going over these really important, especially for this early stage, just before you hire, when you're still interviewing, I think really know what these are and really look out for them, because you do not want to hire the wrong person for your project. Let's get into the episode. As you know by now, everything I teach about renovations falls under my five pillar process and the information in this episode falls under pillar three people. Let's get into it.

Speaker 1:

Okay, so let's go over the seven builder red flags. Number one is the lack of proper licensing and insurance. So if you ask your builder for their insurance or any source of licensing that applies in your country or wherever you are in the world, and they are unable to provide it or they are hesitant to provide it, this is a big red flag. It matters because proper licensing really ensures that the builder meets the industry standards and regulations in whichever country you live in. So that's why the licensing is important. So any licensing that they might require they really should be having ready to show you. And then also the insurance. The insurance is a major one because no matter how good your builder is, they need to have insurance because things go wrong they just can go wrong sometimes and there needs to be that security and that cover of the insurance. So obviously the insurance will protect you from being held liable If any accidents or any damage unfortunately happens in the duration of your project. The builder should have their insurance set up. There are additional insurance insurances that you can get as the client and obviously you can look into those as you so wish, but the builder really must have proper insurance and they should be able to provide you with their insurance certificate without any arguments. They should be able to provide you with that and that document should also detail what they're insured for and also the amounts.

Speaker 1:

And then red flag number two this is a big one for me and one I've come across quite a lot, and it is lack of detail on their quote or their estimate or project spec. So to me, if a builder cannot provide a detailed breakdown of every single job that needs to be done, with a figure allocated next to it, and really go into detail to each section of works, then for me this is a red flag a renovation consultant, when I put forward a quote to my client that that builder knows what he is doing and that he knows the process and that he knows every single step that needs to be be included. And another reason why this matters is because if it's not clearly listed out line by line by line, then this also leaves you open to loads of exclusions. Let's just say, a builder gives you a quote that's not detailed and they're just explaining really briefly what needs to be done, with a final figure or two at the end you don't really know what's included in that unless it's broken down. So every line needs to be broken down, or every section needs to have a figure allocated to it, and then you have your grand total with those added up.

Speaker 1:

If a builder is unable to do this, it may be showing that they they are a bit inexperienced, they don't quite know how to put together a proper quote and they don't quite know how to cost everything out properly, which then leaves you open to not only exclusions. So an exclusion is something that you that is not included in their figures or in their quotation. So let's say you're mid-project and something comes up that you thought may have been included let's say, for argument's sake, it's fitting the windows and the builder then says to you that was not included in my price, that's going to cost you an extra three thousand pounds. Let's say that is a huge amount to not have expected to add into your budget. So this is why exclusions are so important and why breaking down the quote is even more important. It's so that you know exactly what you're getting and what you're paying for. And if there are items outside of that, you need to know about those as well, so that you can budget for them and not have surprises mid renovation.

Speaker 1:

And then number three might be an obvious one, but it is when a builder is reluctant to provide a written or signed contract. So this may seem obvious, but actually loads of builders will quote, and there's so much going on. When you're right at the start of renovation process, you may be reviewing drawings from the architects, you might be talking about your planning application or your planning result, you might be arranging where you're going to live for the next few months while the renovation goes on, and so sometimes a contract can be quite easily forgotten. So just make make sure that your builder is prepared to provide you with a contract, a signed contract, and inside that contract it should detail the scope, the materials, the timeline, the costs, and the contract is beneficial to both parties really. So your builder should be wanting to provide you with this. So the red flag is if they don't want to, and it protects both of you. It ensures that the project is completed as agreed. It may also help to deal with if there are misunderstandings during the project. You can refer back to the contracts and, of course, it will also help with disputes. I hope you don't have any disputes on your project, but if you do, everyone can refer back to the contract and see what was initially stated and agreed and signed upon.

Speaker 1:

Moving on to red flag number four, which is if your builder is unable to provide any references. So be really careful on this one, because if a builder has any negative reviews, let's say online on their website, or if you're finding them through any online way, or if they refuse to provide references or say their clients are unavailable, this is quite a big red flag, because you want to know that your builder can do the job that you're paying them to do and you want to know from their previous clients what they would like to work with, what the quality of their work was, that they were reliable. There's so many things that you need to find out before you hire a builder or contractor to do your project. Before you hire a builder or contractor to do your project, I always recommend that you get at least three recommendations, and out of those three, I would say two should be from finished projects, so projects the contractor or the builder has completed, so they absolutely complete.

Speaker 1:

The clients have moved in, they've been living in the property for a little while, and then you want to speak to those clients and ask them about how the build was, how it was communicating with them, how it was working with them, and all the usual questions you would ask. But then also, in addition to that, I always recommend that you ask for a live project recommendation as well. So what this means is a project that the builder might be currently working on, because I think from a live project you can get different information. Working with our builder is then fresh in the client's mind because they're currently doing it. They might be able to relay any kind of frustrations or downfalls of working that with that particular builder or they might have positives. They might be able to give some great recommendations of why they are enjoying working with a contractor currently. So the difference in the two is obviously, on the finished project recommendations, you want to see the finished project, you want to see the quality of the work and the workmanship, and on the live project recommendation, you want to gauge how that client is currently working with a builder and if the builder's communication is good. So why this matters is because obviously, the past work they've done, the past performance of the builder, is a strong indicator of how they will be carrying out your project. And if a previous client has experienced had some bad experiences or experienced some issues dealing with that builder, communicating with that builder, workmanship or perhaps calling them back if they've had issues with a with a project, getting them back on site to fix things then obviously that's a sign that you might encounter the same issues with that builder as well.

Speaker 1:

Okay, so moving on to red flag number five, which is an unusually low bid. So this is a red flag because if this contractor provides a quotation that is significantly lower than perhaps two or three other quotations you may have received and I always recommend that you get at least three quotations or estimates for your project before making a decision but why it matters is that a low bid could hint that the builder doesn't fully understand the work that might need to be done, so they may be inexperienced, they may not know all the steps and the proper costings of each job involves, or they might be using materials that aren't of great quality, which means they can do it for a lot cheaper than the other quotes you may have gotten in, or they might even be underestimating the amount of work that needs to be done or the scope of work that needs to be done so that they can secure the job over the other contractors. And then, as you can imagine, all of these things put together can lead to poor workmanship, unsatisfactory end to your project and possibly even disputes as well. So red flag number five if there's an unusually low bid, really investigate it and try and communicate with their builder if you're still interested in using them, perhaps exactly why their bid has come in so low, and ask them questions about their materials. Ask them for a breakdown. If they haven't provided a breakdown, again, if they are willing to provide a more detailed quotation, then every line item should be described with a cost next to it.

Speaker 1:

And then red flag number six is poor communication or unresponsiveness. So I've spoken about this so much in the podcast so far about the importance of good communication on a building site. But even if at quote stage the builder is being unresponsive perhaps he's submitted his quote or his estimate and then he's become quite difficult to get hold of to ask questions to provide you with some more information then that should be a major red flag. And this matters because During your project and on a building site, communication is key. I mean effective communication is vital to the success of your project. So if a builder is unresponsive or uncommunicative even before the project begins, I mean that is really not a good sign. It just means that it's likely that you're going to have communication issues throughout the project and without good communication your project is going to be a very, very frustrating and difficult thing to get through. Communication with your team, with your contractor, with everybody involved really is key to a successful project. So you really really want to get this one right, because communication issues will worsen as a project goes on and it may lead to delays, frustration, miscommunication, things going wrong. So you really really need to make sure that when you're at this early, early stage trying to find a contractor or builder for your project, that they, their communication, is really really good.

Speaker 1:

And then red flag number seven is if the builder insists on a large upfront payment or deposit. So this one has always been a red flag for me. If the builder's pressuring you to sign a contract quickly, or if they put in pressure for a large upfront payment, that is never a good sign. They should not be using aggressive sales tactics to get your job and I for my personal projects, for my client projects. I have never paid a deposit and all the projects I've done because generally reputable builders can manage their money. They can manage their money, they can manage their cash flow, they can manage the projects and even if they need to buy a number of materials up front, even if they need to use a certain amount of labour up front before you give them that first payment, if they are a good builder and they know what they're doing and they know how to manage things, they should be able to start your project without any money being transferred. First you need to get the contracts in place and your agreements and then, from that stage, you can then decide on when payments will be made. But this has always been a red flag for me.

Speaker 1:

Now, saying that, I do know that other people have have done this. They've done projects where they have given their builder a large payment of, let's say, five, ten, fifteen thousand pounds. The builder's turned up, the project has gone smoothly and they've done a good job. But out of the many projects that I've worked on, I've never, ever paid a deposit. So I think if the request for a deposit is coupled with pressure, with requests for quick signage of contracts with any sort of tactics that goes against your gut feeling, then this is a major, major red flag. So that brings us to the end of this episode.

Speaker 1:

These red flags are so important. Please come and re-listen to this episode. If you're about to start a renovation, perhaps in a few months time or in a year's time, if you're not quite ready to do this just yet, just come back, revisit these red flags before you hire anyone for your project, particularly your contractor, and just go over these red flags again, because just being aware of these red flags will help you hire a competent and reliable contractor for your renovation project. You're putting so much into it. You're putting your time, your planning, your money, everything into your home. I keep saying, besides actually buying your home, renovating a home is probably one of the next most expensive things you will ever do. So you want to get your people right. Pillar three you have to get your people right and be aware of these red flags. Do come back, please, and listen to this again just before you're about to hire your builder, and always do your due diligence, ask the right questions and trust your instincts when you're interviewing those all-important builders or contractors. Well, that's bye for now, everybody, and I look forward to seeing you in the next episode. Bye for now.

Speaker 1:

For more information on my five pillar process for successful renovation, you can go directly to southplacestudiocom forward slash pillars, where you'll find an introduction to the process which covers each of the pillars and what they cover. We also have a number of other free renovation resources. Go now to southplacestudiocom forward slash freebies. I have created some amazing freebies for you there. There is one on the process, like we just said. There is one on planning permission, there is one on kitchen design, there is another one on lighting planning. Go and check those out. There's so much free information there to help you with your renovation.