Homeowners Blog about Home Improvements
Categories: Buying Real Estate, Coral Gables, Life & Style, Selling Real Estate
hiHOMEOWNERS BLOG: Earth Date 11.21.08
Its been a month since my last blog – the approved construction drawings are sitting at the Building Dept. waiting for a permit to be issued. Since the City records show that I have approved drawings waiting, I’ve been getting letters from contractors wanting to do the work. I’ve chosen three contractors to give me bids – the three I chose came highly recommended from personal friends who had recent work in their own homes. That way I am comparing similarly qualified contractors who do quality work and who are not going to try to play the Change Order game or disappear after they get the contract — notice I did not say anything about a deposit. If a contractor needs a large deposit to start the work, you have started behind the 8 ball already. We will talk more about that in future blogs.
I’ve already received two bids and the spread is fairly big – today I receive the third bid and over the weekend I will put the numbers into an Excel Spreadsheet and will make sure we are comparing apples to apples. I also want to make sure that everything is included. I want the best price, but I don’t want to fool myself with a contractor who may have missed some major components or assumed using the cheapest of materials. I did the drawings in a way that they give me some flexibility and asked for cash allowances for certain items like finishes, cabinetry, plumbing and lighting fixtures, etc. I may be able to save some money and get better quality by buying some materials myself. I may also be able to separate some portion of the work and sub contract them out myself and reduce the overall cost of supervision.
The next week I am going to determine if I can really afford what I have designed. One bid is way out of my budget and either the contractor assumed I was installing gold leaf on the walls or he doubled some of his numbers or maybe he does not want to do the work and this is the way he is telling me. The second bid is closer to my budget, but I have not reviewed to determine if he has too many exclusions. Sometimes contractors will give you a bid and it looks great. When you start analyzing you see that he excluded all plumbing fixtures, finish carpentry, light fixtures, etc. By the time you add those back, you are in the same place as the higher bid. So this weekend will be the time to review all the numbers and decide if we go ahead with the construction.
I also have to take into consideration the current economic situation. While I am not financing the work, I don’t want to leave myself in a bind if this recession deepens or lasts longer than expected. On the positive side, contractors and subcontractors are hungry and will compete for the little work available. With the price of oil declining construction material prices are also declining. So this is a perfect time to build and remodel, but it is also a scary time because of all of the uncertainties. So this weekend I will be analyzing all factors and making a decision whether to build; not build; reduce scope or just sell the house as it is and buy something else using my Portability provision… a lot to think about.
Thanks for the update, Carlos. We are in the middle of re-doing our kitchen. We knew it needed it when we bought the house 4 years ago, but have been putting it off. A broken pipe in the wall behind the kitchen sink forced our hand. So now everything’s ripped out, the new cabinetry is in production, the new stove and hood on order, gas repiping and plumbing being done. And we’re living off a plywood sheet set up on sawhorses! I figure about five more weeks.
I assume you got a better deal doing the work now when contractors are a bit desperate. I already received all my bids and now I am comparing. I have two bids that are about $26K apart and the third is out in left field $163K higher than the highest of the other two.
One thing I noticed is that the higher priced bid estimated about $70K for cabinetry while the other two were at $20-23K. Also the Overhead and profit on one is about $25K higher than the other two, so right there you have $75K. Now I need to see where is the rest of the difference.
Good luck with you remodeling…