Home Contractor vs. Homeowner

Why Builders Shouldn't Cut Their Prices

2009-10-21T22:30:00.001-04:00

In a previous post, I discussed why now is a good time to renovate. I pointed out that builders are not as busy and can devote more time to their projects, the economy has weeded out a number of "fly by night" contractors who were not truly dedicated to the profession and there have been sales on supplies and materials. One advantage that I did not mention, however, was the opportunity to ask builders to cut their prices. That's because I do not believe it's reasonable for owners to try to negotiate lower prices, and it's not good for the profession for builders to do so.

Professional builders are usually quite realistic when preparing proposals for projects. I have met many contractors who proudly tell me that their jobs do not go over budget (barring unforeseen circumstances). They are usually quite clear about their markups and profit margins and accurate when determining allowances. They exemplify the adage that "you get what you pay for."

Consider for a moment the bid that comes in that is significantly lower than the others. Owners may be happy to seize the opportunity to get a job done for a bargain price. However, I have frequently seen the rest of the story in my practice. The project begins and then the owner is hit with a series of change orders that jack the price up to those of the other bids, or once the work is finished, the owner receives a final bill for "extras" that achieves the same result. Or, the contractor cuts corners and substitutes inferior materials or does work that is not up to a reasonable standard. At that point, a huge dispute arises and the parties end up in costly litigation.

Although this post may be filled with cliches, if something seems "too good to be true," it is. Choose a contractor based on references and experience. Do not try to bargain and take advantage because construction is slow right now. It is better to change the scope of your project and pay a fair price. This benefits all of the parties in the end.

Time and Materials Contracts-Are They Illegal in Massachusetts?

2009-10-17T10:47:00.000-04:00

I must admit, this question has been plaguing me as it pertains to Massachusetts. This issue applies to residential renovation only, but I know of many high-end contractors who use this method for their projects.

Massachusetts law provides:

Chapter 142A: Section 2. Residential contracting agreements; requirements

Section 2. (a) Every agreement to perform residential contracting services in an amount in excess of one thousand dollars shall be in writing and shall include the following documents and information:

(1) the complete agreement between the owner and the contractor and a clear description of any other documents which are or shall be incorporated into said agreement;...

(4) a detailed description of the work to be done and the materials to be used in the performance of said contract;

(5) the total amount agreed to be paid for the work to be performed under said contract;

Given that a Time and Materials Contract does not have a price, I would argue that it violates the Home Improvement Contractor Law. Further evidence to support that belief was supplied by the Office of Consumer Affairs and Business Regulation. They administer the Home Improvement Contractor Arbitration Program that is run by the state. The program is supposed to provide consumers (and contractors) with a more economical alternative to resolving disputes than litigation and does not require the parties to hire attorneys.

The Office of Consumer Affairs and Business Regulation recently rejected a claim filed by a colleague because they said that the Time and Materials Contract made it ineligible for the program.

The purpose of a Time and Materials Contract is theoretically to protect both the owner and the contractor. The owner is only paying for the cost of the actual materials (usually with a mark-up) and the actual hours worked. The contractor does not run the risk of under-bidding a job and much of the risk is removed because he is paid for all of the actual effort expended. These kinds of contracts can be fraught with problems because homeowners frequently question the amount of time spent and are frustrated if the contractor cannot substantiate his records. That said, as long as the contractor stays in constant communication with the owner (I believe in weekly meetings), they can work well. They also allow for instantaneous change orders to keep the project within budget.

However, when one looks at the statute, it requires, "the total amount agreed to be paid." Contractors should keep in mind that any violation of M.G.L. c. 142A is an automatic, per se violation of the Consumer Protection Act, M.G.L. c. 93A. Under that law, the consumer may obtain up to double or triple damages, attorney's fees, interest and costs in a verdict against the contractor.

So, a colleague has suggested that one way to avoid this issue is to include a guaranteed maximum price (GMP) in your contract. The GMP could be adjusted if necessary when a change order occurs. It is also important to include a detailed scope of the work to validate that price. I strongly urge all of you to include a GMP in your contracts and make sure that you ask for no more than one-third of that price for your deposit (unless the deposit also includes the cost of custom materials).

I cannot guarantee that this will avoid the question of the legality of Time and Materials Contracts, but we will not find out until this solution is tested in the courts.

Protecting & Preserving Fine Wine

2009-10-15T21:13:00.002-04:00

Here's a great guest post from Paul G. Cox, the Business Development Manager at Vigilant Woodworks on wine cellars:

If you have a growing collection of wine, it may be time to think about building a wine cellar or tasting/entertainment area in your home. Some time ago the custom wine room was unusual; today more and more wine lovers are learning about wine cellar construction or contracting the work out to those who know how to do the job properly.

Wine cellars are more than a dark, cool place to stock a collection of wine bottles. Today’s custom wine cellar is a controlled environment where humidity and temperature are regulated to allow wine to correctly age without damage to corks, labels or the wine itself.

There are two styles of wine cellars. One is an area that has been particularly made to store wine in the correct environment and the other is a stand-alone system that duplicates those conditions. A stand-alone wine cellar is not as effective as a custom-built version, but some people like the aesthetics of a small cooled refrigerator over a custom wine cellar. Those who do choose a custom cellar have three basic considerations for proper creation…

Temperature Control and Venting

A wine cellar room is used to hold and age the wine in the bottle rather than keeping it at a serving temperature. (A stand-alone wine fridge is excellent for carrying wine out of the cellar to hold at serving temperatures.) Aging wine is a balance of time, temperature and the chemical reactions that happen as a outcome of the two.

Wine should be matured in conditions ranging between 55 and 65 percent humidity and a solid 55 degrees Fahrenheit, within approximately one degree. Wine stored at higher temperatures will mature quicker and wine experiences chemical reactions at higher temperatures that devalue the notes of the wine over time.

In some areas of the country, property holders with basements often realize that conditions are right for basic wine storage, but seasonal temperature and humidity variations ought to be avoided. The perfect storage solution is a custom-built or DIY-construction wine cellar with climate and humidity control using a wine cellar cooling component to maintain the temperature at a stable 55 degrees.

These units come in a variety of sizes and the dimensions of your wine room will dictate what size you need to purchase. Never select a wine cellar cooler too small for your room; you most likely will never get a accurate, optimal storage temperature and the wine cooling system will become overtaxed trying to keep up.

Wine cooling units demand proper venting, and your wine cellar construction project requires either a hole in the wall to allow venting outdoors or enough vent space to flow warm air out of the room. Check the specs of your wine cooling unit; most require a venting space at least two times as big as the wine room space itself.

Electrical power is also an issue. Custom wine cellar builders recommend a devoted power source to run a wine cellar cooling system. Those who want to use a common power source frequently find the system overloading with blown fuses and other electrical problems.

Insulation and Vapor Barriers

The wine cooling system is only part of your climate control plan for a custom wine cellar; you also need a vapor barrier made of plastic sheeting used on the “hot” side of the wall. Some people wrap the interior of the wine cellar before inserting the insulation, leaving the plastic loose so that insulation can be placed between the studs in the wall. Cover the ceiling and the walls, or your vapor barrier will be incomplete. After the barrier is put in, the insulation comes next.

Good wine cellar building needs the right kind of insulation for your walls and ceiling. For instance, if you are building a 2x6 wall, R19 insulation is recommended, but if you have a smaller wall of 2x4, R13 may be your best bet. (The “R” designation represents the heat resistance of the insulation.) Ceilings require R30. Custom wine cellar builders should not install the insulation loose without packing the material into the sections, as this decreases the insulation’s effectiveness.

The next step is to install a kind of drywall called green board, which is moisture-resistant, making it a bit more expensive than regular drywall. Install an exterior-grade door to the wine cellar and your climate control plan is complete.

Lighting and UV Exposure Control

Wine is destroyed by UV exposure, which is why the bottles are normally constructed out of dark glass. Avoid putting in fluorescent bulbs in the wine cellar room, as they give off UV radiation. Control the brightness by using recessed lighting on a dimmer and avoid shining light straight on your wine bottles for long periods of time. Some wine cellar racks are made with compartments that hide bottles from the light which can help reduce exposure, but if your bottles are stowed in clear view, try to avoid the “spotlight” effect on your bottles.

Other Concerns

Nearly any kind of flooring can be used in your custom wine cellar. If your home is big enough for a wine tasting room to complement your cellar, you may wish to give them both an identical look, but by no means use carpet and rugs in the cellar area. They simply can’t hold up to the required humidity levels without surrendering to mold. Mold growth will wreck your wine, as can any powerful odor from chemicals or cheeses. A wine cellar should be used only to hold wine; keep food in a separate area.

Constantly examine the temperature and humidity in your wine cellar with an external sensor or gauge. By no means guess that the wine cooling system will always function accurately. A quick glimpse at the external gauge can offer you early notice if the wine cooling unit is having difficulties, or if the unit is showing a wrong readout because of a bad sensor or other technical troubles.

Constructing a custom wine cellar room may require some attention to the design demands of correct wine storage, however once properly built, you may realize that your collection grows quickly; it’s simple to invest more money in wine when you know it will be held safely for maximum delight.

About Vigilant

Vigilant is a premier design/build firm for custom and specialty cabinetry and millwork, specializing in wine cellars and wine storage and display for the home and commercial markets. Check out our extensive educational resources focused on building a wine cellar on our web site, www.vigilantinc.com.

Stylish Solar Roof Panels-A New Product

2009-09-04T09:00:00.000-04:00

Check out these solar roof panels that look like traditional roofing tiles:

http://www.solarfeeds.com/energy-boom/8756-stylish-roof-solar-panels-are-coming.html

Five Excellent Tips to Get Your Home Ready for Fall

2009-09-03T00:05:00.001-04:00

All of these tips are quite doable and environmentally friendly.

http://www.managemyhome.com/mmh/authored/articles/5+Tips+for+the+Dog+Days+of+Summer?sid=twitter

Preventing Fire in Your Home

2009-08-21T09:00:00.000-04:00

An important post on preventing fire in your home:

http://www.managemyhome.com/mmh/authored/articles/Preventing+Fire+in+Your+Home?sid=twitter

This article provides a great public service.

13 Top Bathroom Remodel Trends

2009-08-21T00:14:00.001-04:00

http://realestate.msn.com/article.aspx?cp-documentid=13108041

This is a great article for contractors and homeowners alike.

Home-Energy Plan Spreads Out Costs

2009-08-20T10:18:00.001-04:00

Why can't Massachusetts do this?

http://online.wsj.com/article/SB125064722656442071.html

I know a contractor who has started a business doing energy audits and I am going to ask him to guest blog. Now we just need local loan programs to defray the costs of doing energy-saving retrofits. At the end of the day, the homeowner is saving money by improving the environment, the contractors are getting much-needed work, and everybody benefits.

Five Misconceptions About Home Energy Performance

2009-08-19T11:58:00.002-04:00

I really like this post about the latest options in green products, because it points out that one should educate oneself before "jumping on the bandwagon" when choosing green materials.

http://earth2tech.com/2009/08/13/top-5-misconceptions-about-home-energy-performance/#more-38989

Remodeling Magazine's article on Energy Retrofitting.

2009-08-01T16:26:00.002-04:00

Part of dealing with the difficult economy is considering whether it is time to focus on new areas of practice or developments in construction. This article by Leah Thayer suggests that retrofitting houses with energy efficient improvements can benefit both contractors and homeowners alike.

In fact, I recently met a contractor who had started a new business doing energy audits and making recommendations. I have said frequently that one way to deal with the recession is to take the time to learn a new skill or work on a new area for your business.

Energy saving measures seem full of opportunity. There are many rebates available for homeowners to implement them, so this can be a win-win for homeowner and contractor alike.

http://www.remodeling.hw.net/blogs/postdetails.aspx?BlogId=lthayer_blog&PostId=88266

Do Homeowners Need an Advocate

2009-07-22T23:29:00.001-04:00

http://users.homepros.com/content/blog/656-3

An informative and useful post from HomePros.

What the New Home Buyer Wants-From BuilderOnline

2009-06-21T22:49:00.007-04:00

Even as we worry about today, researchers, community planners, and pollsters are probing consumer demand to predict what they will want tomorrow and the definitive answer from those presenting their findings at the Pacific Coast Builders Show is something different.
The current economic situation has triggered a shift in people’s values from an era of indulgence to one of responsibility, trend tracker J. Walker Smith of Yankelovich said Thursday morning.
That translates to the home-buying consumer as a desire for homes that fit but don’t exceed space needs, are greener, and that are part of a community. It doesn’t mean that buyers are dour, though, he said. Instead, it means the opposite, because the more anxious we get about the economy, the more we look for the bright side of things, according to Smith.
It’s up to home builders to tap into those traits to find a market. “They (builders) have got to be the the voice of optimism for consumers,” Smith said.
Buyers are also looking for homes in a walkable environment with most of their daily needs met in a small footprint. That setting could be urban setting or “suburban-urban," which would be a new development that's not within an urban core, but does include some of the characteristics of a city in a planned community. “We have structurally overbuilt the wrong products in the wrong locations, delivering what the market doesn’t want,” said Christopher Leinberger, a land strategist, developer, and author of “The Option of Urbanism: Investing in a New American Dream."
Leinberger said he thinks there’s pent-up demand for walkable urban product, but concedes the industry hasn’t solved the difficult equation of building them. The infrastructure is costly, he acknowledged, but the final product does command higher prices.
In terrms of the suburban-urban model, master plan communities with urban touches in the form of town centers with grocery stores, restaurants, and retail stores nearby have boosted sales in Newland Communities’ projects as consumers look for convenience and bargains. “Consumers are adapting (to the new market),” said Malee Tobias of Newland Communities. “They are shopping even smarter than they ever did before.”
She also pointed to a new trend called “hiving," which means poeple are spending more time socializing within their community, with neighbors, and hosting events at home rather than driving distances for entertainment. “Entertaining at home is one thing they are not cutting back on,” Tobias said.

The Unrealized Value of Owning a Green High Performance Home.

2009-06-19T23:44:00.000-04:00

From Tony Marnella's Blog at http://tonymarnella.wordpress.com/.

I wrote back in January about the behind the scenes inspections and testing that the green high performance homes get that many don’t know about or if they do, don’t appreciate the intensity of them. Since we continue to hear about Buyers wanting the “Best Deal” or the “Best Value”, it occurred to me that the Value of these homes is also not being realized.

For instance, 100% of the homes we build here at Marnella Homes are built to the Earth Advantage/Energy Star “Gold” level. Our homes are extremely well sealed and with blow-in insulation achieve a very low leakage rating. Also, with our 95%+ HVAC systems, fully sealed ducting and all inside the home in conditioned space. Our home owners save on average $40 – $50 a month in our 1400 – 1600 sqft homes over a similiar sized code built home.

Home owners have been sold over the years all the features that builders put in and are told how great they are and sometimes even how many years the home owner will receive a payback from these features. What so many times doesn’t get either explained or truly appreciated by the home owner or buyer is the value of these features. We took on the venture of Green performance building with the “What’s in it for me” approach. Thinking just selling features to someone who doesn’t know much about the industry will tend to make their eyes glaze over. So, we have tried to show our home owners and buyers “what is in it for them”.

In the case of a monthly savings, this is a direct savings over what they would be paying for utilities at any other new code built home. Plus, even with many builders getting on the green built performance band wagon most are doing just the minimum to get their homes certified so, we are outperforming most builders in our area. This is money that can be for that massage every month, the manicure, dinner, a movie with the family, a ski lift ticket in the winter, etc. So, many things that these homes make easier to afford. Because, isn’t the old saying, “a penny saved is a penny earned” more relevant today than ever before in our life time?

Now that I have addressed the actual savings, let’s look at the added value. Using the $40 – $50 a month in savings, at today’s interest rates that is about $8,000 to $10,000 in additional value to the home. Of course, our lenders aren’t going to let you borrow more because we can show the energy savings, but wouldn’t it be great to know that you have built-in additional financial strength due to the lower monthly cost of home ownership? I do believe that some lenders will eventually see this value and want to work with builders like us once this resonates with them. However, I am not holding my breath for this to happen anytime soon.

Lastly, now that real estate has moved back to a more traditional style of ownership, I feel that the long term value that these homes offer is also important. Energy costs are going to continually rise so, in 5, 7, 10 years or so when we sell our homes doesn’t it seem that it will be a added value to your buyer that your home saves a considerable amount in monthly utility costs over the resale homes that will be on the market at the same time? I think it should now and most assuredly then.

So, buying a home isn’t just the countertops, the carpet and appliances. Sure those are the features that you can see, feel and touch, but don’t over look some of the most important features that truly create the “value” in your home. You can always change your carpet, appliances and countertops, but it tends to be a little harder to retrofit a high performance HVAC system inside your home in the conditioned space if you are replacing a traditional system it’s not very easy to go back and effectively caulk and seal up a home that is already completed.

Please share your comments. I would like to hear from you.

Renovation Junky

2009-06-13T12:41:00.000-04:00

Here's a fun, new site for renovation ideas and information: http://renovationjunky.com/

Building Products Top 100 List-53 Are Green Products

2009-06-11T19:54:00.000-04:00

http://www.ecohomemagazine.com/green-products/readers-top-requested-products-shine-spotlight-on-green.aspx

When Your Contractor Runs Out of Money

2009-06-04T00:13:00.003-04:00

I have gotten numerous calls over the last few weeks from homeowners whose contractors have run out of money. Either the contractors tell the homeowners that they are unable to continue, or warning signs occur. The contractor starts asking for payments ahead of the work, he presses you to sign new contracts or change orders for additional work, subcontractors start to complain that they aren't being paid, or he just disappears.

The homeowners are frantic and they ask me what to do. The contractor hasn't quit, but they are stuck.

First of all, I would recommend confronting your contractor and asking flat out if he or she is having cash flow issues. Contractors frequently apply funds to previous job, subs or suppliers, and in this economy, they are getting caught short. If the contractor is honest and tells you the truth, it may be worth your while to advance some money to the contractor or pay extra and ask for some extras. It may save you money and aggravation to pay your own contractor a little more to get the job done.

Second, do not just terminate or fire your contractor. If you do, you run the risk that your contractor may bring an action against your for breach of contract. Go back and read your contract and see if there are any clauses that address bases for terminating the contract.

Instead, write a demand letter to your contractor. In it, state that you are proposing a schedule for completion and payments to serve as an addendum to your contract. If the contractor does not agree to your proposed schedule or suggest one of his own, then you can state that he will be in breach, and you will "mitigate your damages" (reduce damages) by hiring another contractor to complete the job. That way, the contractor will be the one who is in breach.

A note to contractors: I represent contractors and construction companies and I am sympathetic to your situation in this economy. That said, it is better to be honest with owners and try to work things out then to disappear or keep asking for more money. Now is the time to fess up and ask for additional funds to complete the job. It may maintain the good will you have generated and result in more work from referrals in the future.

Solar Panels for Rent for Homeowners

2009-05-25T18:15:00.001-04:00

This was in yesterday's Boston Globe:

SUN FOR RENT

Boston Globe
It's an old energy problem with a new solution: After decades of facing prohibitively high costs to install solar panels, Massachusetts residents will be able to lease the panels for a tiny fraction of their upfront cost.
Beth Daley
May 24, 2009
-->
Sun for rent
State hopes affordable leases will make panels an electricity option for more homeowners
By Beth Daley, Globe Staff May 24, 2009
It's an old energy problem with a new solution: After decades of facing prohibitively high costs to install solar panels, Massachusetts residents will be able to lease the panels for a tiny fraction of their upfront cost.
Instead of paying $25,000 or more to buy solar panels, homeowners will have to shell out only about $1,000 to install the energy collecting devices on roofs. The companies involved in the leases say most homeowners will be able to recoup the initial cost within seven years through electricity savings - and then save money on future bills by locking in the rate they pay for the electricity generated by the leased panels.
The long-term leases - similar to how residents might contract for cable TV service - are now being offered through a private company, which will take advantage of federal and state subsidies to help lower costs.
"It's great from a green perspective but also from a straight economic argument," said Eric Friedman, a Newton homeowner and state environmental employee who just signed up to lease solar panels.
Governor Deval Patrick is hoping "solar as a service" will help the state reach an ambitious goal of getting 250 megawatts of solar power by 2017. Today, the state has 9.7 megawatts.
Unlike the sprawling Southwest and other sunny places, which can host giant solar parks to generate electricity, the crowded Bay State wants to build up its solar network on the rooftops of urban triple-deckers, big box stores, and suburban subdivisions.
Commercial buildings across the country have been able to finance solar panel lease deals in re cent years, but homeowners were often left out. The costs associated with financing such small projects just didn't make sense to banks.
But the available subsidies - and the high price of electricity here - make it possible for private companies to offer the lower-price option of leasing while still turning a profit.
A company called SunRun Inc., which has done similar business in California and Arizona, is the first company to enter the Massachusetts solar lease market for homes. It owns the solar panels and partners with local solar installers - in Massachusetts, Alteris Renewables and groSolar.
Here's how the program works: A homeowner calls one of the companies to assess the potential for solar at the home and install panels. A one-time, upfront fee of about $1,000 is charged, and the homeowner also is given an 18-year locked-in rate for energy the panels generate. That rate will be comparable to, or less than, what utilities charge, according to the companies involved. If the homeowner uses more energy than the panels produce, they then pay the utility its rate for the electricity.
A typical home getting about 62 percent of its electricity from solar might pay around $77 a month for the solar electricity - and maybe $46 more for electricity from the utility for a total of around $133, according to Alteris Renewables. If they were getting all their electricity from the utility, it might be $151, Alteris estimates.
"We did a lot of market research, and not surprisingly we learned the upfront cost [for solar panels] is too high for people," said Lynn Jurich, cofounder and president of SunRun.
Homeowners who sign up for the leasing program do not have to worry about upkeep of the solar panels: If a panel breaks, it is replaced at no extra charge. They are also freed of other details, such as tying the panels in to the electric grid or applying for the rebates and subsidies. The company - not the homeowner - gets the state and federal subsidies because it owns the panels.
The state subsidy program that helps make Massachusetts attractive territory for such lease arrangements is called Commonwealth Solar. It is offering $68 million in rebates over four years to residents, owners of commercial buildings, and communities. It gives back an average of 40 percent of the cost of solar panels to the purchaser.
Add to that a new federal tax break of up to 30 percent of the cost of the project - the previous federal incentive maxed out at $2,000 - and the price of solar comes down enough to be competitive with traditional utilities in Massachusetts.
The Bay State is not expected to have such generous rebates for long. Already, 716 Commonwealth Solar rebates have been awarded, amounting to more than $25.5 million, according to state officials. Of that, 587 are homes, 113 are commercial or industrial buildings, and 16 are public entities.
But the state hopes the flood of money now - along with other efforts to bring installers and solar manufacturers to the Bay State - will cement the industry in Massachusetts enough to drive competition and lower prices so such generous rebates are not as necessary in the future.
Without the subsidies, SunRun wouldn't be in Massachusetts, because solar is still more expensive than electricity from fossil fuels.
"The goal is to get enough competition to bring down that cost," said Ian Bowles, state secretary of energy and environmental affairs. He said other measures are helping, such as making it easier for homeowners to sell renewable energy they generate back into the grid, allowing utilities to own solar installations, and requiring long-term purchasing contracts with utilities to purchase renewable energy.
The state is also examining making solar a requirement for utilities and other electricity suppliers in the future.
Michael Durand, a spokesman for NStar, a large Massachusetts utility, said the company was supportive of any effort to help reach Patrick's solar goal. "Having a variety of options will be helpful in meeting that goal," he said.
For homeowners, there are some caveats. One, you need sun. The best place to put solar panels is on south-facing roofs that get direct sunlight. And rebates, final costs, and savings can vary based on energy use, how much sunlight you get, and competing electric rates.
One downside might be that panels' cost may come down in the future. Homeowners who move can transfer their solar agreement to the new homeowner, buy out the contract, or purchase the panels.
Still, state officials and solar advocates say the $1,000 or so investment makes sense even in a recession.
"Solar has a guaranteed return," said Adam Browning executive director of the San Francisco based Vote Solar Initiative, a nonprofit that works with states to improve policies to grow solar. "You tell me where else you can get this rate of return in this economic environment."
For Friedman, who is renovating his home as green as he can, his decision to have Alteris install solar panels made sense. Even with all the rebates and other incentives he is eligible for, it would have cost him around $11,500 to buy the panels. His $1,000 investment is expected to be paid back through lower electricity bills within four years.
Beth Daley can be reached at bdaley@globe.com.
© Copyright
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2009 The New York Times Company
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Build Green and Save

2009-05-06T23:03:00.000-04:00

Kim Hibbs interviews the author of Build Green and Save.

http://www.itsthecustom.com/

How to Hire a Home Contractor

2009-05-05T11:11:00.000-04:00

Here's a helpful post by Daniel Mackey Construction:

http://danielmackey.livejournal.com/5703.html

Construction Deal-A Blog with Excellent Home Construction Articles

2009-04-29T09:28:00.001-04:00

http://www.constructiondeal.com/blog/

Meadowview Construction Offers Great Advice for Contractors and Homeowners

2009-04-12T18:33:00.001-04:00

http://www.mvconstruction.com/index.htm

10 Things You Must Put in Your Next House

2009-03-29T12:30:00.001-04:00

This is a reprint from the Builder magazine website:

http://www.builderonline.com/products/10-things-you-must-put-in-your-new-house.aspx?page=1

From: BUILDER 2008
Posted on: December 15, 2008 8:44:00 AM
10 Things You Must Put in Your Next House
Add these features to boost the value of your homes with your buyers.

Americans love getting a deal, which might begin to explain why so many consumers flock to shopping malls on Black Friday. Of course, they aren't always ending up with a real bargain, but sometimes this doesn't matter. As long as an item or service has a high perceived value to people, there’s a good chance they’ll choose to buy it.

This concept can be applied to selling homes. Create high perceived value, and you stand a better chance of closing the deal with buyers. One way to do this is to offer high value at a low cost. If your cool-looking kitchen was inexpensive to build, but it looks like it cost tons of money to do, you’ve hit a home run for your business and your buyers.
With that in mind, here are 10 items to put in your next home to create real and perceived value for your buyers.

Radiant-heated bathroom floorsForget fancy water-filled tubes embedded in concrete. You can now buy simple mesh-and-wire mats that install fast and easy under ceramic tiles. They cost as low as $10 a square foot and come with a variety of thermostats. Put a toasty floor in your homes' bathrooms and watch your buyers melt.

Butcher block countertopsWood is the original solid surface. Used as an island or a bar, it holds nostalgic memories for older buyers and offers a fresh natural look for younger customers. It traditionally comes in maple, but butcher block is available in other species such as cherry and birch. An 8-foot-long top measuring 1.5 inches thick and 25 inches wide can be had for as little as $189.

Glass tilesYes, glass is cool. And yes, it’s pricey. But used sparingly as a kitchen or bath backsplash, glass can’t be beat. It reflects light, shimmers with color, and is virtually maintenance-free. If you shop carefully, you can buy it for as little as $7 a square foot.

Dual flush toiletOne can only imagine the perceived value of a dual-flush toilet installed in a powder room, which will cost about $250. That is about $100 more than a standard toilet, but it can save a family of four up to 6,000 gallons of water per year.

Low-flow showerheadsThere’s a chance you’ve used a new low-flow showerhead and don’t even know it. And that’s the point. These units use air to deliver the same robust performance as a traditional showerhead, but with a flow rate of 1 gallon per minute as opposed to 3.5 gallons a minute.

On-demand water heaterDepending on your climate, an on-demand (or tankless) water heater is an excellent choice. It does cost more, but instead of heating water at a constant temperature 24 hours a day, the energy-saving unit only activates when there is a need. Plus, it installs on a wall (inside or outside) and frees up space, which is especially important in the smaller, lower-priced homes that buyers appear to prefer in the current economy.

Water re-circulatorIf a tankless water heater is a little too edgy (and costly), you can still give your home buyers instant hot water by using a high-efficiency conventional heater and a water re-circulator. With the push of a button, the device circulates ambient-temperature water from the line so hot water is instant and nothing is wasted down the drain.

Folding patio-doorIn 2007, four out of the most popular 10 products among BUILDER readers were folding patio-door systems. Here's why: When closed, these doors look like any other, but they fold up like an accordion to provide access to the great outdoors. Full-wall installations are pricey, but you can reduce cost with a two-panel system.

Central vacuumA central vacuum cleaner is a built-in system consisting of a power unit, collection canister, and hose. Connected by special pipes installed within interior walls, the system collects dust and deposits it in the centrally located canister. Five times more powerful than an upright, it’s quiet and efficient. Plus, an entry-level system can cost as little as $800.

Excellent insulation Insulation isn’t sexy, but when it’s 95 degrees in the summer or the mercury dips below freezing in the winter, your buyers will thank you for this, even if they didn't see the perceived or real value when they first signed the sales contract. Forget the entry-level insulation, and go for something that will really stuff the wall and the roof. While you’re at it, don’t forget the attic.

Nigel Maynard is senior editor, products, at BUILDER magazine.

Moving Away from the Billable Hour in Construction Law

2009-03-04T09:00:00.000-05:00

I am going to tell you a secret. Most lawyers hate the billable hour. It is hard for us to keep track of our time, even with all of the latest software and technology. Most clients do not understand why some activities take so much of our time. They don't understand the value we provide. That is why more and more lawyers are trying to change the way they charge and use flat fees and other means to bill their clients.

The other day, I had an epiphany. As a lawyer who works mostly in the construction industry, I should bill like contractors. I could prepare a proposal and scope of the work, and notify the client in advance what I would charge. If things changed dramatically, we would execute a written change order that would be signed by the parties. Everyone would be on the same page, and there would be no surprises.

This is easier to do in some areas than others. I pretty much know how much time it takes me to draft a contract, write a demand letter or file a mechanic's lien. The trickiest area is in litigation. The minute you file suit, you have no control over the process. The other side can make it quick, or drag the lawsuit out and make it incredibly time consuming and expensive.

However, I am doing research and trying to figure it out. I have never been comfortable with the fact that the first time I write a motion, it will take much longer and cost the client more money than the tenth time I write it. The billable hour does not encourage efficiency, and I am very efficient. I do not want my clients to be afraid to call me because they believe it will be costing them extra money to speak with me. Those conversations can frequently prevent problems and save money in the long run. So, look for some changes in the way I practice. They are coming soon.

Why You Need a Good Renovation Contract

2009-03-03T23:25:00.003-05:00

I just had a great experience as a lawyer last week. A client called and he was not unhappy. In fact, he was about to start a home renovation project, and was really looking forward to it. He found a contractor he liked, and he and the contractor were working together collaboratively. A colleague suggested to him that he come see me to draft their contract. It certainly made sense.

For less than 1/2% of the value of the project, we hammered out a contract that spelled out the understanding of the parties. It is in compliance with local law, so the contractor is protected. In fact, the homeowner told me that the contractor was willing to chip in and help pay for my fee. Discussing the contract terms helped the homeowner further define the scope of the project and a realistic payment schedule.

We discussed what would happen if change orders were necessary and how they would be handled. The homeowner decided what would constitute an unreasonable delay. Problems were anticipated and dealt with preemptively.

This experience was in huge contrast to the usual scenario in my practice. I receive a call from a desperate contractor or homeowner and things are going terribly wrong. It is usually too late to get the project back on course, and on some level, everybody loses. That is why I started this blog; to serve as preventative medicine, and to encourage more people to take my client's approach from last week. This may be the best money he has spent so far to ensure a successful home improvement project.

Home Owner/Contractor Patterns That Raise Red Flags

2009-02-15T15:06:00.004-05:00

One of the advantages of having handled numerous home contractor/homeowner disputes is that I have a global view of the problems that arise. Homeowners and contractors are frequently shocked when something goes wrong during a renovation project, but if they are made aware of the "signs," the problems may be preventable.

1. The contractor who tells you that you do not need a contract. Sure, things are great at the beginning, but working without a contract can be a recipe for disaster. The purpose of a contract is to memorialize a "meeting of the minds." As one arbitrator said to me, "the best kind of contract is put on the shelf once it is drafted and left to collect dust."

2. The homeowner who is overly preoccupied with details and processes. Homeowners should be actively involved in the renovation process. However, if they have difficulty making up their minds over the smallest issues, or insist on controlling minute aspects of the work, the project could be a nightmare. They will never be happy, and will greatly reduce the profitability of the job. Watch out for micro-managers.

3. The contractor who keeps asking for money. If the contractor is continually asking for money ahead of the work, that is a sign that he may be in trouble. Contractors can get in over their heads and use money from current jobs to pay off prior ones. In addition, your contractor may have a substance abuse problem. Make sure that suppliers and subs are getting paid in a timely fashion. Have a clear contract that spells out payments as phases of the work are completed.

4. Homeowners who keep asking for extras. It's fine to do something just to be nice, but a contractor who continuously does extras to please the homeowners may find himself in a difficult position. Homeowners may take advantage and again, profitability will be reduced.

5. The contractor who does a lot of extras for the homeowners, and then comes back with another bill. I have heard contractors say so many times, "did they really think I was doing this for free?" Of course the simple answer is that all change orders must be in writing! If you are not sure if something is included, ask.

6. The contractor who does not spell out which materials will be used. I have seen many situations where contractors cut corners. Serious corners, such as putting up pine siding on an addition when the rest of the house is cedar. Make sure you know what you are getting so there are no misunderstanding.

7. The contractor/homeowner who is a bully. This goes both ways. If something is making you uncomfortable, listen to your instincts. A renovation project should be collaborative. If you are being bullied, take back control.

8. The contractor whose price is much lower than the other quotes. You get what you pay for. If the price is significantly lower, it is probably not a good thing. The contractor will discover that his bid is too low and be tempted to cut corners or use cheap materials.

9. The homeowner who overextends herself. I have to say, I am often shocked by homeowners who do not maintain some money on reserve when planning an addition or home improvement. Homeowners are often shocked projects run over budget, but it is quite normal for there to be change orders that result in extra expenditures. Contractors should make sure that their clients understand that an extra ten percent should be budgeted for the job. In addition, they should be wary of homeowners who are living so close to the bone that they run out of money before the project is finished.

10. The contractor who takes on more work than he can handle. Beware of contractors who are running a number of projects at once. In addition, make sure that yours is not the biggest job that the contractor has ever handled. You want to know from references that the contractor has handled comparable projects previously. In addition, if they do take on more than one job at a time, the contract should spell out the hours the workers will spend at the job, and how many days per week they will be on site. The last thing you need is a contractor who disappears for weeks at a time.

These are some of the patterns to watch out for over the course of a renovation project. If something does not seem right, do not ignore your instincts. Address the issue immediately before major problems develop.