Contractors are by and far good people that dedicate their lives to making people's dreams come true. They generally come from a trades background and it's second nature to them that project completion triggers payment receipt. This is an extremely respectable career that gets a bad rap due to a few bad apples, misunderstandings, and nuance. Contracting is one of the most challenging professions in the world, so best to start by acknowledging this. Hiring the right contractor for you and your project may take some time, but it's worth the effort to find the right ally.
Considerations to Take into Account
General contractors are usually from a carpentry background. However, anyone and everyone says they can carpenter. In this trade, you will find the full spectrum of skills, abilities and personalities out there. It is a very, very important factor in any build project to find the right person for the job. The project manager will intrusively be in your life for months until completion. (Hint: never, ever live in a large remodel). Ask yourself: "Do I want the slow and expensive guy, or the fast and cheap guy?" The right contractor is out there, you just have to clarify what you're looking for before hiring anyone.
In residential contracting it's important to accept upfront that anything and everything will happen during the build process. It's easy to blame the contractor if something goes wrong. It's easy to become defensive when someone is in your personal space and you're forking over a lot of money. When things go wrong, best to take a breath, get forward progress on a solution, and then let it go. Try to enjoy the construction process and get a result that makes you happy. Don't complain, be empowered.
"Start slow finish fast" is a jobsite tradesperson's term. It's also very much applicable to owners approaching a construction project--or really anything in life for that matter. Be intentional and be patient, choose a contractor that matches you. Be willing to pay for the grade of work that will make you happy, and develop mutual respect during the build. Curate your relationship with the contractor since they will take care of you for decades. You'll be one and done for the duration you live in the area.
Here are a few tips to finding and hiring the right contractor for your job:
1. Word of Mouth Referral Only
It is all about finding a match. Referral is the only way to find a contractor, period. Don't go out and hire a contractor without going through a vetting process. Online reviews might or might not be real, also what standards or needs did the reviewers have? Work your network and ask people you know that have had work done in the last few years for recommendations. Get multiple referrals, check them out and see who you like. The contractor should be good match with you. Even if a friend had a good experience with them doesn't mean they'll be right for your project.
If you leave your initial meeting with the contractor and something feels off, don't think about it too much. Just move on. If it doesn’t feel like a fit, then it isn't. Can't find someone willing to do what you want, on your schedule, or at your budget? Don't stress out or feel forced to work with someone you don't feel comfortable with. Reevaluate and think about your project again and do a little more footwork. It might take a year or two to find them and start work, so be patient.
2. Know Your Needs, Trust Yourself, Stay in Your Comfort Zone
One of the most important decisions you'll make in hiring a contractor is deciding if you are a compare-multiple-bids or time-and-materials (T&M) type of person. Whatever you do, don't ask for a bunch of bids from a bunch of contractors. That will increase their costs, and you'll attract people that have a weak customer base. The rules are: get at the most three bids, and never choose the lowest one. Personally, I think T&M is best option in most cases. T&M means better cost performance and increased transparency. This exercise is all about knowing which telephone number to call, not about spinning your wheels on competing bids.
One issue we run into is the homeowner wants to use our product, but the contractor isn't comfortable working with it. They may present other siding options they have experience with, or they may double the labor due to fear of the unknown. You've got to cut them some slack since there are so many ways to lose money contracting and you're asking them to install some weird high-end sooty stuff from Japan. However, our product is wood just like any other. If the carpenters have experience with wood and are conscientious, then it will be a cake walk. Better to find someone you want to work with, then hammer out the budget and details collaboratively.
3. Go Look at the Contractor's Current Jobsite
If you're a forward type, you are only considering one or two contractors, and your project is meaningful in scale, then talk to a homeowner referral or two on completed projects. Get the perspective of someone who's already hired the contractor. Ask questions about their project, about how it went with them and their team. Also ask about budget overruns or permitting problems.
You can also get an address for a current project to drive by. You can often learn just as much about a contractor by driving by their job site as you would talking with a client. Look at how organized and clean it is. Think about the type and scale of the project in relation to yours. Also has it been shut down for weeks? Does it have materials or trash in the jobsite flow paths or on the sidewalk or street? Janky scoffolding? Is it fabulous--or a junker? Does it exist?
4. Make Sure the Contractor is Licensed and Insured
If you get references, great, but always make sure to check someone's BBB rating as primary due diligence. There will be complaints if there is a pattern of problems. Before you spend a bunch of money, check a few standard local laws regarding construction contracting compliance. In most states there are lots of consumer protection laws and regulations. In most cases, states require a contractor to have a license and to have insurance or be bonded. To become licensed, the contractor has to pass technical and/or ethical testing parameters and the bar is often very high. There are probably many more fly-by-night contractors in unregulated states (such as Texas).
Insuring or bonding is basically a financial guarantee that you will have access to compensation if something goes wrong and the contractor is at fault. This is similar to commercial liability insurance in other industries. Note that a "contractor" is a business, different from a worker i.e. "carpenter". Hiring a licensed contractor will cost double or triple per hour than a carpenter. There's a lot at play: compliance, taxes, safety, insurance, permits, code. Construction is an expensive proposition. In order to protect your assets, it is wise to hire someone vetted by the government.
5. By All Means, Please Sign a Contract
Working with a contractor is a nuanced, complex relationship. Managing expectations appropriately on both sides is the name of the game, and the relationship needs structure in the form of a contract. Make sure the terms are complete, specific and you understand them. Don’t move forward on a project without a signed contract. Do your due diligence on someone and the law, then feel confident to sign the thing.
In most cases when you hire a contractor, they will provide the contract. As such, their team will develop the contract to protect themselves. Negotiate terms you don't like. Either add, edit or remove parts of the contract that don’t work in your favor. If that is not possible then bring in an attorney for counsel, or walk away. Also communicate your needs in writing, whether it’s setting certain work hours, making sure the area is kept clean, etc. If it's a large project or there's liability involved, definitely ask your attorney to review it for you. Any clarifications the lawyer brings to your discussion might actually help the contractor improve their business going forward.
6. Manage your Expectations, Be Patient, Be Cooperative, Get the Job Done, Write the Check
Working with a contractor is a partnership. Contractors have often seen it all and their eyes glaze over when homeowners are nit-picky. A friend of mine who's also a GC has a six-month rule: there will always be details the owner doesn't like, but if they let it go, they won't notice it any more after six months.
Choose your battles and be reasonable. If you're a details person like me, there will be some things you'll want to be adamant about. Small blemishes, slight tone difference or other piddly stuff, just let it go. After all, it's only a house. The most important part of the entire project is simply getting to the finish line.
Another thing to keep in mind is that residential construction projects never go according to plan. How you and the contractor work through the problems will make all the difference in your opinion of them. This is your dream house and usually a big investment. Enjoy the process and don't let stress get the better of you. Roll with it.
Note that change orders are a real drag on getting the job done and project efficiency. If you change your mind on anything it will cause a chain reaction of extra work and planning problems. It is only fair to compensate them for it.
The contractor will want to finish the job, get paid, and move on to the next one. Confirm that benchmarks are hit and then pay them immediately. Owners and project managers will often tire out towards the end of the project, so manage this fatigue dynamic. Don't pay them the final check until the punch list is complete.
Red Flags to Look Out For
The sections above really go over most things to keep in mind. However, in my experience there are a few red flags it's good to watch out for:
- If the contractor is a smooth-talker that shows up in a black SUV with fancy rims and tinted windows. Red flag! Don't hire them! It sounds comical but this is a real thing.
- If the contractor asks for a large down payment up front, don't pay it. A down payment is normal to book a reliable, high-end contractor. However, it is also a common trick for manipulative or incompetent contractors. The contractor says they will schedule the project soon, so you give them a deposit to book their schedule. Then they don't show up as promised, and have delay followed by excuse. This might be a competence issue and not ethics, for example if their sub does not show up as promised. Either way your check is already deposited and spent.
- During the build process watch out for over-billing and manipulation. On a T&M project, the contractor will bill you for their time or they will add their margin on top of subs and materials. Do not allow the contractor to bill for their labor and add profit to that.
- Watch out for incremental negotiation where the conversation moves laterally. The build process can be confusing to the client. Watch out for subconscious baiting and switching. In my experience contractors are often people that came up in the trades working and apprenticing under an older tradesperson. They learn the ropes on the job, so they're often conditioned to negotiate each client interaction to their advantage. This often plays out as manipulation (keep in mind this is standard protocol for many salespeople across most industries). Over the years a contractor will lose money over and over from numerous pitfalls they encounter. So they'll often instinctively try to squeeze profit any chance they can get simply to survive.
- If anything happens that gives you a red-flag gut reaction, then stop construction immediately. Keep it halted until the issue is remedied to your satisfaction. If it's too far over budget then that is a sure sign that they are not a match for you. If the sub is not doing work according to what was decided with the GC, then stop it. Trust your judgement, hold up your hand, and yell "stop!"
Remember: pay a fair price for good work, enjoy the process, don't cut too many corners, and most importantly, get the job done.