When working with a contractor, having a good relationship is always a vital component of the process – especially when it comes to properly budgeting.
When it comes to hiring a contractor, there are a lot of things you should consider, but for most people, the top concern is likely going to be price.
You’ve probably heard stories about construction projects that went over budget, whether they are a government financed freeway or a bathroom remodel in your friend’s house. It is, unfortunately, a fact of life, and something even the most experienced project managers contend with every time they start a new job.
Construction is not an exact science, and it is constantly affected by challenges that can’t always be foreseen. A contractor may be working on a kitchen and suddenly find that the plumbing is in bad shape and needs to be replaced to avoid a potential catastrophe down the line. Or they may find wood rot that threatens the house. Or the cost of the chosen material could suddenly rises due to a spike in demand, or one of a thousand other issues that couldn’t be planned on. There are also costs that are common to anyone that works in construction, but may seem like a surprise to anyone else.
Construction can be expensive, and those fees begin with the contractor’s own costs. In addition to things like standard employee expenses, taxes, and general overhead, contractors are required to keep large insurance policies, CCB licensing, pay for bonds to keep everyone safe, pay for permits, and more. And that’s all before the work even begins.
When you are planning on hiring a contractor, keep in mind that the fees quoted to you are an estimate based on things going smoothly. Speak to your contractor and ask them to go through all the fees with you. If you have concerns, the contractor should be happy to explain where every dollar is going. Working with a contractor that is willing to be transparent is important.
Once you have the general fees down, decide how much you want to spend, and where you want to cut corners. Marble counter tops are attractive, but if you are on a budget there are several other options that look just as nice and will save you significant money. Then, when you have a good idea of what everything will cost, budget a little extra for when something you couldn’t possibly have prepared for happens. The same is true for those taking out a loan for a remodel – make sure to take a little more than you think you need. Taking a slightly bigger loan is better than suddenly realizing you underestimated the costs.
So when you are planning on having some work done to your home or business, be sure you know how to budget properly for the job at hand – and then budget some more.
If you have any questions or would like to discuss budgeting, please contact us anytime!